In today’s technology-driven world, humans have made significant advancements in various aspects of life. However, this increased reliance on technology has also led to a rise in cyberthreats, making cyber insurance a vital component of business risk management. According to Evaa Saiwal, Head of Liability Insurance at Policybazaar for Business, the cyber insurance market has experienced a significant shift from being a niche product to a critical business requirement over the past few years.
“The surge in demand is driven by the evolving nature of cyber threats,” Saiwal explained. “The market is on a strong growth trajectory, not only among large corporations but also among SMEs and emerging sectors. In fact, nearly all cyber insurance clients—close to 100%—are renewing their policies.” This indicates a growing recognition of the importance of cyber insurance in maintaining business continuity.
What Cyber Insurance Covers
Cyber insurance typically covers financial losses and liabilities resulting from cyber incidents such as data breaches, ransomware attacks, business interruptions, and associated expenses like forensic investigations, legal counsel, and crisis communication.
Key Components of Cyber Insurance
Cyber insurance policies generally include two key components: first-party and third-party coverage. First-party insurance protects the policyholder against direct losses and expenses due to a cyber event, while third-party insurance covers legal liabilities from claims filed by external parties affected by the incident.
Interestingly, nearly 45% of cyber insurance claims in the B2B space are linked to business interruption. “This highlights the growing role of cyber insurance as a tool for maintaining business continuity,” Saiwal noted. “Organisations are increasingly turning to these policies not just to manage financial risk, but also to minimise operational downtime.”
As cyber threats like ransomware, phishing, and data breaches become more frequent, integrating cyber insurance with broader cyber risk management strategies will be essential to fostering a secure and resilient digital business environment.
