Coronavirus pandemic among other fatalitieshas triggered spurt in cyberattacks. Cyber criminals are exploiting theCOVID-19 outbreak as an opportunity to use digital fraud techniques to stealfunds of people by claiming to have important updates or encouraging donations,impersonating trustworthy organizations etc.
Basically, in the world of Internet, we areall at risk and at the same time we are also a risk to others. This kind ofscenario is keeping everybody guessing as cyber frauds have become order of theday. The risk of stealing credentials of the browser is widespread which thefraudsters then use for everything from finance fraud to outright identitytheft.
So, in a scenario like this, we can atleast protect ourselves from others. However, the most important task is toprotect ourselves from our own actions. A most common advice on protectingyourself against the cyber frauds is to have a better understanding of what theonline threats are. Even as measures are in place and are continuously beingupgraded to insulate browsers against cyber frauds, the social engineers provetoo fast in innovating new online techniques to defraud people.
Mostly these cyber frauds ultimately end ina financial fraud. Now the point how to get protection against cyber fraudswhen protective measures already in place too fail to insulate you against acyber fraud.
Here, it’s the cyber insurance cover whichis the need of the hour. Given that more people are using smart phones andfinancial transactions via Internet and mobile are rising, cyber insuranceshould become a ‘must-have’ in an financial plans of organizations as well asindividuals.
What is cyber insurance?
It is an insurance product designed by theinsurance companies to protect a company or organization from various cyberrisks. In other words, cyber insurance provides protection and coverage for thesecurity and privacy of digital information and losses resulting from databreaches.
What does it actually cover?
A cyber insurance cover protects cyberrisks like unauthorised online transactions, phishing, email spoofing,e-extortion, identity theft, damage to e-reputation and cyber-bullying. Itevens covers legal expenses in case of a legal dispute arising out of specifiedrisks covered in the policy.
Notably, these policies provide both firstparty and third party coverage. Cyberinsurance may take the form of a stand-alone policy or be made available by wayof endorsement to a D&O or E&O liability policy. Each policy varies.
Even as the insurance coverage is only forincidents that involve electronic hacking or online activities, such insurancepolicy also covers private data and communications in many different formats,be it paper, digital or otherwise. In simpler terms, a cyber insurance policycovers liability claims involving the unauthorized release of information forwhich the organization has a legal obligation to keep private or confidential.The policy also covers liability claims involving breach of privacy, copyright/trademarkviolations in an online environment.
Most insurers also offer value-addedservices, such as network security testing, designed to help companies avoidand mitigate the effects of a data breach, and crisis management services.
What is covered in first party coverage?
Typically, it includes expenses incurred bya company as a direct result of the breach, including remediation andnotification expenses, as well as crisis management expenses; and resultantcosts such as business interruption and loss of goodwill.
What is covered in third party coverage?
Third party coverage under a cyberinsurance policy typically provides coverage for liability in connection withlosses suffered by customers as a result of the theft and use of their personaland/or financial data.
What is personal cyber insurance?
These are the policies offered by theinsurance companies to individuals. Typically, a personal cyber insuranceproduct should, as a minimum, cover the cost of any financial losses of anindividual due to financial fraud or ID theft; any cyber extortion fees; andthe costs of any IT specialists removing malware from devices and replacing anylost data from your computer operating system.
Should you buy a personal cyber insurance policy?
Frankly speaking, buying a personal cyberinsurance product would be an expensive affair. Still you can analyze at yourown end whether it’s actually worth it to purchase for you. Here you will haveto do a little cost-benefit analysis, because you might be paying for somethingthat you don’t really need.
Moreover, just check whether your bank hasgot the cyber insurance cover or not. Many financial institutions provide freefraud alerts for their customers. As already stated above, third part coverageunder a cyber insurance policy typically extends coverage for liability inconnection with losses suffered by customers of the organization as a result ofthe identity theft and use of their personal and financial data.
(Inputs from an insurance expert)