This evolving landscape has transformed cyber insurance from a niche service into an essential part of digital risk management.
What’s driving the increase in cyber frauds?
Mohd. Arif Khan, Deputy CEO of SBI General Insurance, explains that the shift of everyday activities to digital platforms has fundamentally changed the threat landscape. Fraudsters are now leveraging human behavior through tactics such as social engineering, identity impersonation, and the misuse of personal information, rather than solely exploiting technical flaws.
This evolution has led to a rise in cybercrime, making it more frequent and challenging to detect, particularly for individuals.
Focusing on the payments landscape, Ankit Gupta, Business Head – Cyber Insurance at Policybazaar for Business, stated that the rapid growth of UPI, card usage, and mobile payments has resulted in easier transactions but also increased vulnerability to frauds such as phishing, vishing, and unauthorized transactions.
As digital financial activity escalates, so does the financial toll of cyber incidents on households.
From a consulting viewpoint, Raghavendra BV, Partner and Deputy Leader, Cybersecurity Consulting at EY India, noted that cyber-attacks have become more coordinated and financially detrimental for businesses. Leaders often find themselves under immense pressure to respond while juggling multiple vendors, regulatory requirements, and operational continuity, complicating the cost and scope of incidents.
Examining the technology threat environment, Rahil Patel, Chief Growth Officer at QNu Labs, mentioned that attackers are increasingly using AI-driven automation, deepfake technology, and crypto-enabled systems, while numerous organizations remain reliant on outdated cryptographic methods. This disparity in capabilities has accelerated both the scale and speed of successful attacks.
In the crypto sector, Sathvik Vishwanath, Co-Founder and CEO of Unocoin, observed that the immutable nature of blockchain transactions heightens risk. A single weakness in wallets, smart contracts, or key management can lead to irreversible losses in a matter of minutes, making crypto platforms highly appealing targets.
In what way is cyber insurance mitigating these risks?
Khan indicated that cyber insurance has matured into a comprehensive recovery framework for individuals. In addition to covering financial losses, policies now provide legal assistance, access to IT experts for breach investigations and data recovery, and safeguards against repeat incidents.
Some policies also address the emotional and livelihood effects of cybercrime through counseling and wage-loss support.
For households and small enterprises, Ankit Gupta elaborated that cyber insurance serves as a digital safety net, covering direct financial losses and offering structured recovery assistance, including costs related to fraud investigation, legal fees, and third-party liabilities stemming from data breaches.
On an organizational level, Raghavendra BV remarked that cyber insurance facilitates quicker and more decisive responses during attacks by clarifying recovery costs. Coverage enables companies to engage external specialists, secure temporary infrastructure, and sustain essential operations, which directly bolsters business continuity and stakeholder confidence.
Tarun Wig, Co-Founder and CEO of Innefu Labs, emphasized that cyber insurance absorbs the multi-faceted impact of cyber incidents by covering forensic investigations, regulatory compliance expenses, crisis communication, and business interruptions.
This support allows leadership teams to concentrate on stabilizing operations rather than making reactive financial choices.
In digital-first businesses, Atul Monga, CEO and Co-Founder of BASIC Home Loan, stated that cyber insurance enhances consumer trust by ensuring the protection of sensitive financial information and maintaining service continuity even during incidents.
From an operational perspective, Sarika Shetty, Co-Founder and CEO of RentenPe, added that cyber insurance aids digital payment companies in compensating for lost income during system downtimes and meeting fixed obligations such as salaries and rent, while also covering regulatory and recovery costs.
However, Rahil Patel warned that insurance is still a reactive tool. While it facilitates recovery, it cannot replace proactive security investments, especially with the threat of quantum-era challenges looming.
In the crypto economy, Sathvik Vishwanath concluded that cyber insurance reflects maturity and resilience, assisting platforms in managing regulatory risks, recovering swiftly from breaches, and maintaining the confidence of users and investors.
