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ICICI Lombard Expert Blog
 

Companies Purchasing Cyber Insurance Policies After Major Hacks

August 30 2018
Insurance

Following a surge in cyber hacks and attacks, particularly the WannaCry ransomware attack last year, the demand for cyber insurance policies has gone up manifold. Losses suffered due to WannaCry ransomware attack ran into billions of dollars.

Because of sophisticated cyber-attacks, more companies are subscribing to cyber insurance policies to cushion themselves financially in the event of an attack.

While earlier primarily IT companies opted for cyber insurance, today the demand is coming from all industry segments. A cyber insurance covers data restoration costs, ransom demanded by hackers and losses suffered because of operations being affected due to an attack.

It is to be noted that though the IT Act doesn’t make it mandatory for opt for cyber insurance, it does ask firms to follow security measures to avoid falling prey to cyber-attacks. It’s important to note that there have been cases of cyber insurance where claims have been rejected as key points weren’t insured by the company.

For instance, in case a firm is taking a cyber insurance policy devoid of malware cover and has suffered losses due to a malware attack, it can’t claim any compensation for the losses suffered. It is to be noted that India is ranked third after the US and China in terms of cybercrimes.

Home Secretary of India Rajiv Gauba, while addressing a gathering organized by FICCI earlier this year warned about the potential increase of cyber attacks in India in the coming days. Gauba also admitted that India is yet to develop a robust mechanism to deal with the threat.

*Source:Money Control

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