Due to the increased risk of cyber-attacks, the insurance regulator has requested that non-life companies immediately launch individual cyber risk coverage and expand the scope of their existing cyber risk policies. Additionally, the regulator recommended that insurers obtain a first information report for losses under Rs. 5000 and resolve them via an e-complaint filed with the National Cyber Crime Reporting Portal.
The Insurance Regulatory and Development Authority of India ( IRDAI ) has released a product structure for cyber insurance based on the recommendations of a working group established to standardise cyber liability insurance wording. Given the evolving nature of legislation, the working group determined that a standardised product is not desirable. However, the group has published a model policy wording for personal cyber insurance.
The regulator has urged companies to introduce cyber risk coverage for individuals as soon as possible, noting that while insurance companies have historically focused on businesses, individual customers are becoming increasingly vulnerable.
“An individual’s exposure to cyber risks is increasing with increase in exposure to the digital world. Considering the need for cyber insurance for individuals, IRDAI has charted out some salient features, coverage, and suggestions in its guidance document on product structure for cyber insurance, which insurers can look to adopt,” said TA Ramalingam, chief technical officer, Bajaj Allianz General Insurance. He added that his company was the first to offer individual cyber insurance.
IRDAI wants insurers to be more specific in their language regarding negligence exclusions. According to IRDAI, negligence is only an exclusion if the loss directly results from the negligence.
