CybeShed fears of hacking, virus attack by purchasing cyber insurance

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If you also do a lot of digital transactions, online transactions, online shopping, etc, then you will have to be a little careful. As the world is becoming digital, instances of cyber fraud i.e. online fraud is also on the rise. Online fraud gained momentum during the Coronavirus period. In the year 2021 alone, more than 14 lakh cybercrime cases were registered. The question is, if someone is cheated online, can it be covered under any insurance plan? So the answer is yes. This type of insurance is called cyber insurance. Let us understand what is cyber insurance and why it is important to purchase it.

What is Cyber Insurance Policy?

Cyber insurance covers damages caused by virus attacks on your gadgets like laptops, tablets or computers. This type of insurance gives protection against various types of cyber attacks. It also helps to reduce the risk of loss of important financial and sensitive information when stolen or misused.

Cyber Insurance Coverage:

Cyber insurance mainly provides two types of coverage. First is first party coverage and second is third party coverage. First party coverage provides protection against hacking, blackmailing, damage of computer hardware and loss of data due to virus or malware attack. At the same time, if your data is stored with any company or on some other platform and your data gets leaked, then,  loss arising due to this type of fraud is covered under third party coverage.

Pankaj Mathpal, MD, Optima Money Managers, says that cyber risk has increased a lot in the current times. Your data can be targeted at any time. Sometimes the entire system is hacked and money is extorted. Cyber insurance can help to compensate for the loss caused by many such types of cyber risks. After assessing your needs and probable cyber threats, you should buy a cyber insurance policy.

What is covered?

Financial loss due to cyber fraud is covered under cyber insurance. If any third party fraudulently uses the policyholder’s bank account, credit or debit card and mobile wallet, the insurance company will compensate the financial loss caused. Insurance cover is also available for cyber recovery, email spoofing and phishing. Along with this, the insurance company will also borne the cost of legal process in cases related to identity theft and Internet stalking (cyberstalking).

The growing threat of cybercrime:

Cyber crimes are increasing rapidly in the country. According to the data of the Indian Computer Emergency Response Team, a government agency set up to deal with cyber security risks, there were 2,08,456 cases of cybercrime reported in India in 2018, 3,94,499 in 2019, 11,58,208 in 2020 and in 2021, 14,02,809 cases of cybercrime were registered. If you look at the figures, within a period of three years such cases have increased almost 7 times.

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