Insurance yet to catch up with Indian IT

Hyderabad: Though IT companies world wide are busy in opting for insurance cover following the WannaCry attack, Indian IT companies are moving at a snail’s pace when it comes to insurance to protect their IT assets.

Cyber security and information protection are still a challenge for software companies. Threats can come from any quarters, including hackers and scammers.  As IT has become an integral part of the daily corporate activities like online marketing, administrative functions, inventory management, credit card processing, and distribution controls, a tiny intrusion can lead to brand reputation damage, regulatory scrutiny, stakeholder dissatisfaction, and above all financial losses.

This is where insurance firms are helping IT companies to keep the cyber attacks at bay. It takes a cyber risk expert to pinpoint the vulnerabilities and develop an effective enterprise strategy of prevention, preparation, and protection of IT assets. These experts often follow a five-pronged strategy assessment, prevention, preparation, response/mitigation, and remediation. According to G.B Shaikh, a city-based cyber security expert, Indian software firms are not giving importance to insurance unlike those companies in the West.

“With the increase in cyber attacks, IT firms have started to realise the importance of having a fool-proof system with latest anti-virus software, firewalls etc, in place. However, when it comes to insurance, they are not showing the same kind of enthusiasm,” he noted.

Mr Shaikh further said that only the major Indian IT companies, which are handling overseas projects, are seeking insurance as their clients insist on it before sealing the deal. “Clients from the United States often ask Indian IT firms whether they have the cyber security risk protection cover. If they companies don’t have one, they are told to get the insurance before starting the talks. Cyber security insurance covers monetary loss that a company might suffer in case of any eventuality. The terms and conditions depend on the policies and guidelines of insurance companies,” the expert said.