If you are among those obsessed with using a home assistance device or looking to constantly invest in connected devices, you are prone to the risks of hacking. It is, therefore, imperative that you have the apt financial cover to recover costs in case of an untoward incident.
This is precisely why cyber insurance is becoming popular not just among corporates, but also among individuals. Cyber insurance policies cover possible ransomware attacks or attempts to bypass the security system.
India is still a nascent market but there has been a steady rise in its demand. At present, these add-on features are part of a home insurance cover.
In an interaction with Moneycontrol, Shay Simkin, Global Head of Cyber for Howden Specialist Insurance Brokers said the company is seeing demand for cyber products among individuals.
Howden is a global insurance broker with a large presence in cyber insurance.
"We are finding that there is a demand for individuals in connected homes. We are giving individuals add-ons to the home insurance if there is ransomware or if there are infiltrators in the home camera," Simkin said.
There are various risks with having connected homes. An external person hacking into an in-home automation system will be able to control it and wreak havoc. It also creates the scope for data theft from devices like laptops and computers.
So far, less than 700 cyber risk insurance policies have been sold in India and almost 90 percent of these policies have been brought by companies.
Globally, cyber liability policies cover privacy breach liability, cyber extortion, business interruption losses, liability from multimedia and public relations costs, legal expenses and data theft liability. The premiums, generally range between $5,000 to $15,000 per for a $1 million cover. However, the distribution of unsolicited email, wire-tapping, eavesdropping, fraudulent acts, failure to maintain standard computer security are major exclusions under this policy.
Simkin highlighted that since both individuals, as well as corporates, are heavily dependent on computer systems for all processes, there is a rising threat from cyber risks that have made cyber insurance essential.
"Cybersecurity risks are growing. Risks from cyber have moved from being an IT issue to a boardroom level matter. This is because the brand of the business also gets impacted," he added.
From a demand perspective, Howden is now looking to understand the risk is the demand. Simkin explained that there is underinsurance as far as cyber is concerned and therefore, the thrust is to first increase awareness to increase the size of the covers.