Page 21 - ASR_Forewords

FOREWORD
CYBER INSURANCE: WHAT, WHY, WHEN AND HOW
URING the course of its business, a bank is
Dlikely to incur financial losses due to
unexpected events. The causes behind some of
the events may be within the purview of the
bank, in which case, the bank can take measures
to avoid such events. But there may be events
beyond their control and hence, unavoidable.
Fire, earthquakes, floods and similar natural
disasters come under the unavoidable events.
Though not natural, thefts and robberies are also
considered unavoidable. Banks find ways of
transferring the risk of loss due to such
unavoidable events through insurance. Over a
period of time, the insurance sector has matured
and developed suitable products to meet
different requirements of banks and other
financial institutions.
Cyber frauds is a fast emerging threat to most of
the business entities and more so to financial
institutions, including banks. Banks have been
building suitable cyber defence systems to
detect and thwart cyber attacks and minimize, if
not avoid, financial losses. As no defence
solution can give total protection and hence full
assurance, it may become necessary to transfer
the risk through cyber insurance.
Date: November 24, 2017
Place: Hyderabad
CYBER INSURANCE: A REFERENCE GUIDE
Cyber insurance is an evolving ecosystem. Banks
and other entities wishing to cover their risk
through insurance have to understand the need
for insurance,quantumtobeinsured,premiumthat
can be paid, clauses that need to be introduced and
the overall scope of such cyber insurance.
Simultaneously, the insuring companies need to
understand the requirements of banks and offer
appropriateinsuranceproducts.
It is in this context that the present guide on
cyber insurance, prepared with inputs from
academicians, banks and insurance companies,
is being brought out by IDRBT, as a reference
book to both banks and insurance companies.
We are sure, the document will help all the
stakeholders in understanding cyber insurance
and help banks in managing their cyber risk
through appropriate products and agreements.
All the contributors to the reference guide
deserve appreciation for their inputs and
commitment.
(Dr. A. S. Ramasastri)
Director, IDRBT
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