What Is Cyber Security Cover And Why You Need It?

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In the 21st century, the internet and its various channels play an essential role in the communication between businesses and customers. Not only can firms advertise their products, but customers can also reach the intended companies with feedback and grievances. Meanwhile, consumers prefer online payments over cash as a mode of transaction owing to the convenience of the same.

However, while exchanging data and conducting transactions via online channels is convenient, these channels expose users to cyberattack threats. From fraudulent transactions to identity theft, cybercriminals exploit internet users and cause severe losses to individuals and organisations.

In fact, as per IBM’s Cost of a Data Breach Report, the average cost of a data breach has gone up by 9.4% in 2020, costing Rs.5522 per stolen record.

In light of such events, cyber security cover have gained a newfound interest among several. Such an insurance policy helps mitigate losses resulting from a cyberattack and protect an individual’s sensitive personal and financial data.

What is a cyber insurance policy?

 

A cyber insurance policy is designed to help individuals and organisations mitigate losses from internet frauds by offsetting the recovery costs. Such policies cover expenses related to online scams, essentially providing a safety net against scammers.

For example, Cyber Security Cover from Bajaj Finserv under Pocket Insurance & Subscriptions safeguards against financial losses resulting from unauthorised transactions. It extends coverage against internet frauds like – 

  • Hacking

While hacking itself is an umbrella term, it usually refers to a targeted attack on the policyholder’s devices, resulting in data breaches and leaks to a third-party computer system. Alternatively, cybercriminals can also gain remote access to the victim’s computer, usually from a malware installed without consent.

  • Phishing and vishing

Criminals impersonate legitimate businesses and then call, text, or email the victims in an attempt to make them reveal sensitive information. Sometimes, such attackers may also create fake websites that look exactly like the original, coaxing unsuspecting individuals to divulge information like banking credentials, log in details of loyalty programs, etc. 

  • SIM hijacking

In such cases, criminals replace the policyholder’s SIM card issued by telecom service providers without their consent and knowledge. Then, criminals gain unrestricted access to sensitive information like the victim’s phone number, text messages, and even OTPs.

As a precaution against theft of personal data, individuals can also opt for identity assure insurance policy, which comes with added benefits like emergency travel assistance, and blocking all cards covered under the policy.

However, financial losses due to the theft of an individual’s card, phone, laptop, or other accessories are usually not covered under these plans. For such circumstances, individuals can opt for a wallet care insurance plan that helps block all covered cards remotely. 

Importance of cybersecurity insurance policy in the current day and age

Cybersecurity plays a massive role in several sectors across the Indian market, from government infrastructures, cloud servers, financial institutions, healthcare, and retail manufacturing.

As more companies begin to rely on online transactions, the importance of cybersecurity practices, and in extension, cyber insurance policies will only increase day by day. Protection against various forms of cyber attacks like phishing, hacking, SIM hijacking, etc., will become crucial if the firms want to prevent data breaches and financial losses.

Before individuals and companies should start creating a risk portfolio, which outlines a list of expenses, one might occur in the event of a data breach. Also, factor in the third party costs to estimate the total coverage required. 

Cybersecurity plays a massive role in several sectors across the Indian market, from government infrastructures, cloud servers, financial institutions, healthcare, and retail manufacturing.

However, while exchanging data and conducting transactions via online channels is convenient, these channels expose users to cyberattack threats. From fraudulent transactions to identity theft, cybercriminals exploit internet users and cause severe losses to individuals and organizations.

In fact, as per IBM’s Cost of a Data Breach Report, the average cost of a data breach has gone up by 9.4% in 2020, costing Rs.5522 per stolen record.

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