CYBER INSURANCE POLICY

CYBER INSURANCE POLICY

CONTEXT

• A committee set up by the Insurance Regulatory and Development Authority of India (IRDAI) has recommended the introduction of a cyber insurance policy. In October 2020, the IRDAI had set up a committee for cyber liability insurance under P Umesh.

BACKGROUND

• According to the committee report, the number of internet users in India is currently estimated at 700 million.
• India was ranked as the second-largest online market worldwide in 2019, coming second only to China.
• The number of internet users is estimated to increase in both urban as well as rural regions. This number is increasing rapidly so also is the number of users of online banking.
• Features of an Individual cyber insurance policy (cover) Theft of Funds, Identity Theft Cover, Social Media cover, Cyber Stalking, Malware Cover, Phishing cover, Data Breach and Privacy Breach Cover, etc

RECOMMENDATIONS

• • Cyber insurance policies currently available address requirements of individuals reasonably well. However, there are some areas in the product features and processes which need improvement.
  • FIR On Higher Claims – Insurers should not insist on police FIR (First Information Report) for claims upto Rs. 5,000.
  • Clarity – Clarity in exclusion language relating to compliance with reasonable practices and precautions and need for coverage for bricking costs. 

• Bricking refers to a loss of use or functionality of hardware as a result of a cyber-event.

• On Standardization of Cyber Insurance Policy – Cyber risks are dynamic and evolving. Standardization is a good idea but may not be able to address all the emerging risks and is likely to limit innovation.

GOVERNMENT INITIATIVES TO TACKLE CYBER ATTACKS

• Cyber Surakshit Bharat Initiative – It was launched in 2018 with an aim to spread awareness about cybercrime and building capacity for safety measures for Chief Information Security Officers (CISOs) and frontline IT staff across all government departments.
• National Cybersecurity Coordination Centre (NCCC) – Its mandate is to scan internet traffic and communication metadata (which are little snippets of information hidden inside each communication) coming into the country to detect real-time cyber threats.
• Cyber Swachhta Kendra – In 2017, this platform was introduced for internet users to clean their computers and devices by wiping out viruses and malware.
• National Computer Emergency Response Team (CERT-In) – It functions as the nodal agency for coordination of all cyber security efforts, emergency responses, and crisis management.
• National Critical Information Infrastructure Protection Centre (NCIIPC) – It operates as the nodal agency.NCIIPC was created under the Information Technology Act, 2000 to secure India’s critical information infrastructure.
• Information Technology Act, 2000 – The Act regulates use of computers, computer systems, computer networks and also data and information in electronic format.

INTERNATIONAL MECHANISMS

• The International Telecommunication Union (ITU) – It is a specialized agency within the United Nations which plays a leading role in the standardization and development of telecommunications and cyber security issues.
• Budapest Convention on Cybercrime – It is an international treaty that seeks to address Internet and computer crime by harmonizing national laws, improving investigative techniques, and increasing cooperation among nations. It came into force on 1st July 2004. India is not a signatory to this convention.

Internet Governance Forum (IGF) – It brings together all stakeholders i.e. government, private sector and civil society on the Internet governance debate.