Security risks in the digital transformation age

S Mohini Ratna,
Editor,
VARINDIA

We are living in a time when you can rise as high as your ideas take you. In the present-day age and time, technology has become an integral part of life with emerging innovations like Artificial Intelligence, Internet of Things, Robotics and Augmented and Virtual Reality, impacting homes, workplaces, transportation and leisure. Since technology is used for almost everything and like everything, it has got both its advantages and disadvantages. On the negative side, this has resulted in losses across the world from cyber-attacks that will hit $2.1 trillion in the coming years. 

In today's business environment, a world-class digital experience is in demand to delight your customers, sharpen your competitive edge, and boost revenue. But the job of turning ideas into reality is complex and leaves little room for error. Cybersecurity has become a matter of great concern for every organization which has undergone digitization and is active on social media. The need of the hour is to safeguard their websites and web applications from attackers seeking to disrupt, delay, alter or redirect the flow of data. Technology brings a new range of threats to both tangible (e.g. property) and intangible (e.g. reputation) assets. Malware and ransomware attacks are increasing day by day – as is the likelihood of a successful attack, with most of these breaches in the form of malware, usually sent via web or email.

Cybersecurity has become a key strategic priority for digital business. As the attackers vary in target, motive, levels of organization, and technical capabilities, public and private organizations are required to adopt ever-increasing safeguard measures to prevent cyber-attacks. People become victims of cybercrimes and scams because of less awareness about the cybersecurity impacting their day-to-day lives. The reason could be that most people are grossly negligent as they end up sharing details like passwords and pin codes with people they should not be doing so, eventually losing money on the internet.

Insurers sense this as an opportunity to address the real risks that cyber-attacks pose. They offer policies to cover risks such as identity theft and cyber-stalking. Various insurance companies and banks in India have come out with cyber insurance policies.

The global cyber insurance market is expanding, with an annual growth of around 20–25 per cent and is expected to touch US$7.5 billion by 2020. This growth is driven by both regulatory changes like compliance and data protection and regulations such as the GDPR that want to make sure organizations effectively tackle them. 

Furthermore, there is availability of cybercrime policy to cover risks related to identity thefts, social media, cyber-stalking, information technology (IT) theft loss, malware, phishing, email spoofing, media liability, cyber extortion, and privacy and data breach by a third party. The sum assured ranges usually between Rs.1 lakh and Rs.1 crore and this costs between Rs.600 and Rs.9,000 as premium. Apart from the financial losses arising out of data thefts, such policies also cover costs incurred in payments to consultants for investigating the extent of loss, court expenses and legal fees.