Cosmos Cooperative Bank Ltd, headquartered in Pune, was shaken up by two cyber attacks on 11^th and 13^th of August. A total sum of INR 94.24 Cr was robbed using Visa and RuPay Cards of 28 countries. The attack was carried out in two phases, first one being the bigger one. During the first attack, 2,000 transactions were made through VISA cards and Rs 78 crore were transferred out of the country while in the second attack Rs 2 crore were transferred through Rupay card within the country with 2,849 transactions.

Insurance Solution

In such situation, one faced by Cosmos Bank, Cyber policy respond to protect organisation to the best by paying following losses and expenses –

• Business interruption – Covers loss of net profit as a result of a material interruption to the insured’s network, as a result of such hack or security breach.
• Costs & fees of forensic experts hired to find the cause of Hack and related detail
• Defence costs for claim from third party, if any, including customers, regulatory authority etc. In addition to defence cost, cyber policy also pays damages awarded against Insured.
• Fees and expenses of Public Relation consultants to restore reputation and faith in customers and shareholders.

Most important is the cover for amount siphoned off from bank. In case of Cosmos Bank, INR 94.2 Cr is siphoned off by Hackers and such loss or similar losses can be covered under Cyber policy.

Cosmos Cooperative Bank Ltd has lost INR 94.24 Cr amount at the hands of Hackers. Cyber policy provides E-theft loss cover which can respond to direct loss suffered by Insured by way of Hacking. Hackers has fraudulently input some data through Malware through which Hackers got access to Cosmos Bank’s system and they were been successful in transferring fund.

Commercial Crime Policy also has similar cover named, Computer fraud Fund transfer/IT Computer act cover which may also pick this loss subject to cause found in final investigation (Forensic Investigation) and terms & conditions of policy.

What is Cyber Insurance Policy?

• Cyber insurance covers your business’ liability for a data breach involving sensitive customer information, such as personal information, corporate information, credit card numbers, account numbers, driver’s license numbers, health records, IPR etc.
• Cyber insurance policy pays various expenses at pre-loss prevention and post loss services and also pays damages awarded against Insured along with defense cost incurred in defending claims.

Cyber Insurance is –

• Tailored as per needs of organisation.
• Shows high level of professionalism.
• Ensure smooth functioning of business.
• Protect from unnecessary litigation costs.
• Built faith of shareholders.
• Not maintaining adequate Cyber Insurance may also trigger D&O policy.