Claims Process in a Cyber Insurance Policy

Cyberattacks are on a rise, making a comprehensive Cyber Insurance Policy an integral part of any business’s risk management strategy. In today’s digital age with the rising number of mobile phone users, penetration of the internet and rapidly expanding digital infrastructure, it is safe to say that India is going through a major digital transformation. With accelerated digitisation comes cyber risks that can deter business growth. As per a report by cyber security firm Check Point, in 2023 India received 2,138 weekly Cyberattacks per organisation, which is a 15% surge since 2022. Within the Asia-Pacific region, India emerges as the second most targeted nation with 2,138 weekly attacks per organisation, trailing only behind Taiwan’s 3,050 incidents. In this scenario, it is important for organisations to understand the Cyber Insurance Claim Process to ensure smooth and timely settlements.

What is the Claims Process in a Cyber Insurance Policy?

Understanding the Cyber Insurance Claim Process is crucial to ensure hassle-free claim settlement. Though the process may vary from Insurer to Insurer, the common steps to follow in case a cyber threat deters your business includes the below.

1. Discover the Breach: This is the most common step to follow towards making a claiming under a Cyber Insurance Policy. Understand the source of the data breach, has any third-party person or organisation breached your personal or company’s data? If you notice any suspicious activity, then it’s time to take the next step.
2. File an FIR: As soon as you notice any breach, visit the nearest police station or the cyber security department and formally register a complaint. Keep a copy of the FIR with you as you will need to submit it to the Insurance Company.
3. Notify the Insurance Company: Once the FIR is filed, inform the Insurance Company about the incident within 24-48 hours as specified in the policy document. Fill the Claim Form and provide the insurer with all the necessary information to fully understand your case. Remember that any delay in claim intimation might jeopardise your Claim.
4. Implement the Cyber Incident Response Plan: As soon as a Breach of Network Systems is detected, the organisation should immediately implement its Response Plan and minimise damage. Depending on the nature of the Cyber Incident, The Insured organisation should co-ordinate with various experts such as Forensic Experts to detect source of data breach or vulnerabilities, IT Experts to restore compromised network or negotiators to negotiate the ransom payments. In case of a Data Breach, the impacted third parties will file a Claim against the Insured for losses, and the Insured will require lawyers to defend himself in courts.
5. Document the Incident and File a Claim: The Insured Organisation should document the Incident in detail and submit requisite documents such as FIR copy, Forensic Reports, etc. to process the Claim.

What are the Documents required to file a Cyber Insurance Claim?

The Insured needs to submit the following documents for a Cyber Insurance Claim:

1. Duly filled and signed Claim Form
2. FIR copy
3. Forensic Reports (if any)
4. Invoice copy for the expenses incurred for IT consultant services, Lawyer Expenses, PR Experts
5. Details and evidence of loss like people involved, mitigating practices, dates, and acts or circumstances.
6. Invoice copy for expenses incurred towards Data Restoration Costs
7. Copy of legal notice and summonses from a court (if any)
8. Any other specific document related to the nature of loss
9. Report shared by the internal cyber team (if any)

Get Best Quotes for Cyber Insurance Policy with Qian!

A Cyber Insurance Policy protects an insured business from financial losses incurred and third-party liability following a cyberattack or a data breach of a company’s network systems. It is important to ta avail the assistance of an experienced Insurance Broker who will assist you in constructing a Comprehensive Cyber Insurance Policy keeping your risk exposures in mind. It is essential to take into account the Loss of Profits due to Business Interruption and ensure to incorporate appropriate limits under Business Interruption Coverage in a Cyber Insurance Policy. It is also important to ensure that the Cyber Insurance Policy provides coverage for extra expenses such as PR Expenses, Customer Notification Costs which are often substantial. Thus, it is vital to work with an experienced Insurance Broker for Cyber Insurance. If you have any queries regarding Cyber Insurance or you need help in filing a Cyber Insurance Claim, you can get in touch with experts at Qian via email at insurance@qian.co.in or call us on 022-35134695. We would be glad to assist you.