According to an annual survey conducted by Policybazaar Insurance Broker Private Limited, there is a growing demand for cyber insurance in Tier 2 and Tier 3 cities.
The survey, which covered over 4,500 customers, revealed a significant market opportunity for these new-age products. Interestingly, awareness and purchase intent were notably higher in Tier-2 and Tier-3 cities.
Nearly 48% of respondents from Tier-2 and Tier-3 cities had either purchased or were considering purchasing cyber insurance, compared to 36% of respondents from Tier-1 cities. This highlights the growing adoption and demand for cybersecurity insurance beyond metro markets.
What is Cyber Insurance?
Cyber insurance, also known as cyber liability insurance, protects businesses from financial losses resulting from cyber threats and incidents. It helps cover costs associated with data breaches, system failures, and other cyber-related events. These findings underline a direct link between rising internet usage in smaller cities and the growing awareness of cyber risk protection.
Also Read: How Much Can You Really Make Selling Insurance?
What Does Cyber Insurance Cover?
With life and business moving online faster than ever, cyber risks are no longer limited to large corporations or metro cities. Cyber insurance typically covers:
- Customer notification: If a company’s data is breached and personal information is stolen, they may be legally required to inform affected customers. Cyber insurance helps cover this cost.
- Restoring identities: If customer identities are compromised, insurance can help businesses support affected individuals in restoring their information.
- Handling data breaches: Coverage includes incidents where private data is accessed or stolen without permission.
- Data recovery: Insurance helps pay for recovering important data lost or damaged in a cyberattack.
- System repairs: Covers the cost of repairing or restoring damaged computer systems post-attack.
- Ransom payments: In cases of ransomware attacks, cyber insurance can help cover ransom costs (though experts caution against paying, as it may encourage future attacks).
- Legal and investigative costs: If a business faces lawsuits or needs professional investigation services, the policy can help cover these expenses.
Bottom Line
The future of insurance is digital, and the next wave of growth is coming from Tier 2 and Tier 3 cities. Cyber insurance is not just another product; it’s the next big thing.
Insurance partners, the time to act is NOW. Cyber insurance policies offer better commissions and help build stronger customer relationships by providing complete protection solutions. Start pitching cyber insurance today and become a trusted digital protection advisor for the new India!
FAQs on Cyber Insurance
What is not covered by cyber insurance?
Cyber insurance typically does not cover losses caused by preventable issues, such as poor security practices, insider attacks (e.g., by employees), or known software vulnerabilities that were not addressed.
Can cyber insurance replace cybersecurity measures?
No. Cyber insurance is not a substitute for proper cyber defense. It is a safety net, not a shield. Businesses must still use strong security practices like firewalls, antivirus software, and regular system updates.
How does cyber insurance work?
Businesses purchase a cyber insurance policy for protection. If a cyberattack occurs, they file a claim, and the insurer helps cover recovery costs, legal fees, and system repairs.
Who needs cyber insurance?
Any business that operates online or handles sensitive data should consider cyber insurance to protect against the growing threat of cyber risks.
Can cyber insurance replace cybersecurity measures?
No. Cyber insurance is not a substitute for proper cyber defense. It is a safety net, not a shield. Businesses must still use strong security practices like firewalls, antivirus software, and regular system updates.
How does cyber insurance work?
Businesses purchase a cyber insurance policy for protection. If a cyberattack occurs, they file a claim, and the insurer helps cover recovery costs, legal fees, and system repairs.
Who needs cyber insurance?
Any business that operates online or handles sensitive data should consider cyber insurance to protect against the growing threat of cyber risks.
