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What is Cyber Insurance

By Finserv MARKETS - Jan 25,2019
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What is Cyber Insurance?

With increasing visibility of people and businesses in the virtual world, cyber-crimes are on the rise. From social media accounts to bank accounts, and personal data to identity are all prone to hacks and cyber thefts. While a Cyber Insurance policy cannot protect you from cybercrime, it can definitely cover the financial risks associated with it. Moreover, a Cyber Insurance policy can be used to cover IT-related risks as well.

What does Cyber Insurance cover?

Cyber insurance is a relatively new concept in the insurance domain. This policy covers both 1st party and 3rd party losses associated with cyber damage. In the event of a cyber-breach, a Cyber Insurance policy will cover the following: –

  • Forensic investigation – If there is a cybercrime, the business or the individual needs to bring on board a forensic investigator to analyse the extent of damage. A forensic team can also help mitigate the occurrence of such eventualities in the future. A cyber insurance policy will cover the fees charged by 3rd party investigators or the security firms for investigation and mitigation consulting services.
  • Revenue loss – If there is monetary loss due to cyber breaches such as phishing, network shut-down, latency, identity theft or cyber extortion, cyber insurance plans online can definitely help you out, like the cyber insurance Finserv MARKETS offers.
  • Legal expenses – If there is a dispute raised in the court of law with respect to a data breach, the company has to pay fines and penalties due to cyber extortion. A cyber insurance policy will cover you for all such legal expenses.
  • Counselling Expenses– Dealing with the aftermath of a cyber-security breach can be a traumatic experience. A Cyber Insurance policy will cover you for all reasonable fees, costs and expenses of an accredited psychiatrist, psychologist or counsellor chosen by you, treatments relating to stress and anxiety caused due to the cyber breach.
  • IT Consulting Expenses– If you want to avail IT consulting services post a cyber-breach, your cyber insurance policy will provide for cover the expenses incurred.

What is the eligibility to apply for Cyber Insurance?

  • Any individual above 18 years of age can buy a cyber-insurance policy.

What is the premium and sum insured for Cyber Insurance?

Online cyber insurance plans are quite flexible. The premium is calculated based on factors such as:

  • The probability of data or identity theft.
  • The data security arrangements of the individual.
  • The coverage sought by the individual.

What is excluded in cyber insurance policies?

Though the insurance companies provide a wide coverage under this insurance type, there are some specific events which are not covered. These include

  • Illegal online activities performed by the insured.
  • The financial losses that have been reimbursed by the bank.
  • Negligence from user-end which leads to data loss or
  • Cybercrime or data loss which took place before the insurance period commenced.
  • Claims reported to the insurance company after 6 months of the incident.
  • Any distribution of unsolicited correspondence or communications.
  • Bodily injury or property damage.
  • War, terrorism or government acts.

Therefore, besides taking strong cyber security measures enabling firewalls, software patches, penetration testing frameworks and procedures etc., it’s also important to have a Cyber Insurance to enjoy an all-round protection. Opt for Cyber Insurance Plan today and grow your business online, tension free!

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Bajaj Finserv Direct Limited ("BFDL") is primarily engaged in distribution of financial products and services through its digital platform (“Bajaj Finserv MARKETS”) and inter alia renders services of customer acquisition, providing preliminary credit support activities, fulfilment services and post-acquisition customer services to Banks, NBFCs, HFCs. BFDL is also a registered Corporate Agent (Composite) under valid IRDAI registration number: CA0551 valid till 10-Apr-2024 for solicitation and servicing of Insurance Products. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522