Demand for insurance against online frauds is rising steeply and likely to spike further after the personal data protection laws are in place. Having paid heavily for cyberattacks like the one on Cosmos Co-operative Bank, lenders are buying higher insurance cover. When most private sector banks are incuring $10-50 million, one public sector bank bought a cover of $100 million.
The number of cases are also on the rise. Last year, around 3,000 online banking frauds took place. According to industry estimates, one cyberattack happens every 10 minutes with most cybercrimes reported in Maharashtra and Uttar Pradesh.
“Indian companies are increasingly seen opting for cyber insurance to get aspects like forensic costs, cyber extortion costs and other first-party expenses covered,” said Manoj Kumar AS, senior vice-president, Global Insurance Brokers. “There has been a growth in the number of policies by almost 25% cumulatively over the past four years and we expect this figure to go up by another 30% post implementation of Personal Data Protection Bill.”
The obligations of the proposed bill by Justice BN Srikrishna will lead to the data liability cover with companies taking adequate cyber risk cover and enhancing the existing ones, experts feel.The ministry of information technology recently released the Personal Data protection Bill of 2018 in line with the European Union’s GDPR. “The bill has come at the time of major international events such as the recent breach by a British consultancy firm, the WannaCry and Petya attacks, banking data theft and at the advent of strong international privacy laws,” said Kumar.
“While the bill will take the natural course of time in terms of becoming an Act, the present iteration of the bill largely showcases the intent and powers of the government with respect to privacy in India and to put stiff obligations on Indian entities. The enactment of the bill would lead to a major impact on the existing cyber insurance ecosystem across the country,” he added.