Chennai: Cyber insurance category has seen a 40 per cent year-on-year (y-o-y) growth in India as increasing cyber security threats and challenges are prompting organisations to opt for such solutions to offset financial liabilities in case of a breach, a report said.
Released by the Data Security Council of India (DSCI), the report said globally the cyber insurance market is expected to grow at a CAGR of 27 per cent from $4.2 billion (about Rs 29,400 crore) in 2017 to $22.8 billion (about Rs 1.59 lakh crore) in 2024.
India, which is still in its nascent stage of adoption, saw a 40 per cent year-on-year growth from 2017 to 2018, with about 350 cyber insurance policies being sold so far, it added.
Cyber insurance is designed to cover the fees, expenses and legal costs associated with cyber breaches that occur after an organisation has been hacked or from theft or loss of client/employee information.
The report titled “Cyber Insurance in India-Mitigating Risks amid Changing Regulations and Uncertainties” said the insured amounts ranges from $1 million (about Rs 7 crore) to $200 million (about Rs 1,400 crore). For $1 million coverage, premium amount ranges from $6,500-8,000 (about Rs 4.5-5.6 lakh).
The report said India’s yearly ‘cyber premium’ is in the range of Rs 80-100 crore ($11-14 million). While IT/ITes and banking and financial services are early adopters, there is demand coming from manufacturing, pharma, retail, hospitality, R&D and IP-based organisations.
‘With increasing cyber security threats and challenges the country currently is facing, it is important that every organisation takes a 360-degree approach to their preparedness including cyber risk management. Financial services sector continues to be a prime target for cyber and data breaches and businesses could face enhanced cyber liabilities,’ Coordinator, National Cyber Security, Rajesh Pant said.
“Insurance industry must come up with comprehensive risk coverage policies tailor made for the risk assessment of a sector and the business,” he added.