A new insurance model framework for Cyberspace

We have seen a huge increase in cyber attacks in the country since March 2020. The Insurance Regulatory Authority (IRDA) has introduced an insurance model framework in case of leakage or loss of money in a bank account, credit-debit cards, mobile wallets, etc when cyber-attacks and online scams are on the rise.

The Authority has prepared a detailed model framework for what types of coverage can be made and under what circumstances claims can be denied. As a result, companies will be able to expand cyber policies. 

Most of the policies in cyberspace are focused on the commercial and industrial sectors, which have less scope. Some companies introduced individual policies. 

Scams like card cloning, SIM jacking, and skimming are not currently covered by insurance. Claims up to Rs 5,000 can be filed without FIR. An FIR will be mandatory for claims above that. 

There should be a provision against Cyberattacks from abroad to make them part of the protection as well. The loss to the computer hardware due to cyber-attacks is also included in the framework.

What can be insured?

  • Misuse of information on bank accounts, credit and debit cards, mobile wallets, etc. 
  • Loss of personal information and the cost of legal action to prevent it. 
  • The cost of legal action if someone misuses social media accounts.
  • Online intimidation and money laundering, and the cost of legal action. 
  • The cost of restoring information in the event of malware attacks. 
  • Loss of money due to fraudulent information leaked through the internet and the cost of legal action 
  • Loss due to e-mail hacking scams.
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