Personal Cyber Security Insurance: What you need to know

Published: March 8, 2021 at 11:43 am

In this article, Ahirjoy Biswas explains the importance of Personal Cyber Security Insurance; why it is important; what to look for in such policies and where to get one in India.

About the Author: Ahirjoy Biswas is a Computer Science Engineer and has over 18 years of experience in the IT and BFSI industry.

The number of cybersecurity breaches is increasing alarmingly.in India with the rapid pace of digitization of financial transactions. It is also estimated that noncash payment transactions, will overtake cash transactions by 2023. In the recent past, a data breach is reported for many organizations like JustDial, BigBasket, Truecaller, Unacademy, Haldiram’s and many more. Cyber Attacks has cost INR 1.25 Lakh Cr for Indian IT Companies in 2019. According to the Internet Crime Report for 2019, released by the FBI, India ranks third among the top 20 countries that are victims of cybercrimes.

Recent developments in banking, payment and settlement systems have resulted in enhanced customer comfort and flexibility in terms of timing, location and choice of channels. These, however, also expose the customers and banks to the risk of cyber-attacks. Cybercriminals come with different state-of-the-art technologies in the form of viruses, spams, malware, phishing, spoofing, hacking and many more. Recently they are launching Covid-19-themed attacks in the form of phishing emails with malicious attachments that drop malware to disrupt systems or steal data and credentials.

However, in India, personal cybersecurity insurance vertical is still in a very nascent stage. Only a handful of companies offering such covers and at present none of those can be bought directly online and one has to discuss with the individual insurer for buying.


Below s an indicative list of major insurers who are providing Cyber Security Cover,

  1. BajajAllianz
  2. HDFC Ergo
  3. ICICI Lombard

The range of Cyber insurance can be from Rs.1 lakh to 1 crore. As the author called the customer care representatives of two of these insurers, approximate annual premium for an Rs. 50,00,000 (Fifty lakhs) cover found to be around Rs, 12,000/- per year.

Most of the Cyber Security insurers provide the below protections,

  1. IT Theft
  2. Identity theft
  3. Malware Attack
  4. Phishing and email spoofing
  5. Social media cover
  6. Cyber-stalking
  7. Media liability
  8. Privacy and data breach by third party etc.

The common exclusions observed in most of the present Cyber Insurance policies are given below,

  1. Property Destruction due to Cyberattack
  2. Losses due to connection with extremist
  3. Losses resulting in visiting pornographic sites
  4. Unsolicited interaction by policyholder etc.

Data Security Council of India has prescribed a comprehensive checklist for buying Cyber Insurance Cover (for both business and personal users),

    1. What aspects are covered under ‘Cyber Insurance’? Is there any overlap with other traditional insurance? 
    2. Does the policy cover pre-breach cyber risk assessment? Are there provisions for annual premium adjustments? 
    3. Does the policy have a panel of suppliers for post-breach cover – forensic companies, PR, legal etc.? 
    4. Does the policy cover full limits for all coverage? 
    5. Does the policy cover laws of foreign countries, where you have a business, such as GDPR? 
    6. Does the policy have single retention and not separate retentions for each coverage element? 
    7. What is the minimum waiting period for business interruption cover? 
    8. Does the policy mention inclusion of GDPR coverage with full policy limits, to the extent insurable by the law? 
    9. Are voluntary notification costs included in event management language? 
    10. Does the policy include cover under rogue employees? 
    11. Is terrorism specified in the policy, and what does it cover? 
    12. Does the policy provide access to extortion advisors? 
    13. Do suppliers have to be listed on the policy for coverage to apply? 
    14. Is it possible to have firms added to the pre-agreed panel? 
    15. What are the exclusions?

Keeping in view growing cybersecurity breach incidents, frauds and increasing trend from work from home which exposes the users to a less secure network operated from their home, it’s advisable that new-age workers should go for Cyber Security Insurance according to their need.

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