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Why Should You Buy ICICI Lombard’s Corporate Cyber Insurance?

Posted on 29 August, 2022
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Cybercrimes in India are on the rise, with 50,035 cases reported in 2020, as per a National Crime Records Bureau (NCRB) report. This number has been showing an upward trend with an almost 270% rise compared to the 2016 NCRB report. More significantly, India’s digital economy is expected to witness exponential growth to $800 billion by 2030, as per finance ministry reports.losses related to the same.

Putting together these figures brings out the enormous susceptibility of the Indian digital economy to cyber-crime and related threats. The alarming trend and the width and depth of global network penetration make cyber security insurance critical for all businesses.

Corporate Cyber Insurance

Cyber security insurance first came into light in the 1990s and is still in its nascent stages as an insurance policy. Initially, cyber security insurance policy was viewed and designed based on errors and omissions as the risk factor. Corporate cyber insurance can be better understood by drawing a parallel to the coverage in the manufacturing industry, where insurance policy provides cover for defective goods or faulty or damaged parts.

Cyber security insurance or corporate cyber insurance is a contract to reduce the financial risks related to crimes involved in online transactions or losses due to network errors. Constantly evolving digital platforms, technology and software upgrades, and newer tools and systems result in constant changes in cyber security insurance.

Cyber Security Insurance Coverage

1. Inclusions

Cyber security insurance provides coverage against risks broadly classified as privacy risk, operational risk, security risk and service risk. Primarily, cyber security insurance covers first party liabilities pertaining to all the above mentioned risks. Additionally, corporate cyber insurance provides coverage for third-party liabilities in certain scenarios detailed below.

Cyber security insurance provides coverage against the loss of a business’s digital assets. Privacy or data breach is considered as a situation where personal data or corporate information has been compromised. In case the data breach requires notifying customers, corporate cyber insurance also covers those expenses. Moreover, data loss or potential data release threats by third party are also covered.

Monetary losses due to fraudulent transactions, data breaches resulting in reputational damage to the business, loss of intellectual property rights, etc., are also covered under this risk. Multimedia liability is the loss arising from multimedia-related processes of the insured and is included under the policy. This includes defamation due to social media content, print or electronic media content, withholding of information or negligence in sharing information.

Other aspects of coverage include loss of third party data, investigation costs, compensation to customers in case of access failure, etc. Hacking, malware, and unsafe networks are also covered.

2. Exclusions

Cyber security insurance does not provide coverage against certain cybercrime outcomes, considered the policy’s exclusions. Any unlawful or illegal activity, unfair practices with competitors, or other trade practices that do not comply with statutes or regulations will not be covered in case of data leak or damage due to such acts.

If the business insured under corporate cyber insurance becomes insolvent or is liquidated under any circumstances, cybercrime is excluded from coverage as per the policy. Also, any physical or bodily damage due to multimedia breach or misinformation, apart from mental distress, is excluded from cyber security insurance.

Case Study : Niya Silks, a popular online store for silk garments, has a broad customer base, including domestic and overseas customers. Promoting traditional weaves is their USP, and they vouch for the quality of their silk and weaves. Niya Silks also has an active presence on social media. These have resulted in Niya witnessing a spike in online transactions and repeat customers. The growing popularity of digital transactions and paid orders resulted in a large amount of confidential information being stored in their database, including customer profiles, contact details, and other sensitive information. Unfortunately, the website of Niya Silks was hacked, and leaked a large amount of confidential customer information to a third party. The data of approximately 12,000 customers was compromised. Since Niya SIlks had opted for a cyber insurance policy, they immediately alerted their insurer. They also sent out messages to notify customers and express their regret at the incident. Niya Silks also initiated an investigation to understand how the website was hacked despite the various preventive measures and encryptions in place.

The insurer analysed the situation and helped Niya Silks claim for the expenses of notifying customers, investigation, and reputational losses. Thus, the silk boutique was able to offset the losses from cybercrime to a great extent.

Why Opt for ICICI Lombard’s Corporate Cyber Insurance?

  • Flexible policy coverage

  • Customised Risk Assessment of your business

  • Expert advice to choose the right cyber security insurance

  • Purchase cyber security insurance online

  • Swift response and efficient claim handling

Conclusion

The global digital arena is changing rapidly and in unprecedented directions. With the pandemic, the world has become even closer than before. The functioning of businesses has evolved to incorporate virtual workplaces, digital accesses and ‘invisible’ transactions. The shrinking world and technological advancements have enhanced digital economies to do beyond what was thinkable!

However, the downside brings an increase in cybercrime and related threats, making corporate cyber insurance critical for businesses. Cyber security insurance helps businesses offset financial losses due to risks in online operations and transactions. Since cyber risks are diverse and still loosely defined, it is the coverage of a corporate insurance policy that determines its effectiveness to combat risks. Thus, risk assessment of your business is essential, following which experts can advise you on the right cyber insurance for your business. Opt for cyber insurance online and get instant quotes from ICICI Lombard.

  • Corporate Cyber
  • Product Code: 4056
  • Product UIN: IRDAN115CP0001V01202021

Help us know you better!

This contains only an indication of the cover offered. For complete details on risk factors, terms, conditions, coverages and exclusions, please read the sales brochure carefully before concluding a sale.ICICI trade logo displayed above belongs to ICICI Bank and is used by ICICI Lombard GIC Ltd. under license and Lombard logo belongs to ICICI Lombard GIC Ltd. ICICI Lombard General Insurance Company Limited, ICICI Lombard House, 414, Veer Savarkar Marg, Prabhadevi, Mumbai – 400025. . IRDA Reg.No.115. Toll Free 1800 2666. Fax No – 022 61961323. CIN (L67200MH2000PLC129408). customersupport@iciclombard.com. www.icicilombard.com. (Workman Compensation, 4010 , IRDAN115P0010V01200607)