Cyber Insurance for Investment Funds & Asset Management
With the emergence of new technologies, companies like asset management and investment funds are prone to cyber risks. The cyber threat or ransomware attacks and breaches have witnessed a substantial increase in the past few years. Therefore, companies or organizations are vulnerable to such risks. However, asset management companies may mitigate such risk by obtaining or subscribing to the cyber security policy.Read more
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Who can buy Cyber Security Policy for Investment Funds & Asset Management?
The following persons may subscribe to the cyber insurance policies:
- Asset management companies such as mutual funds dealing in the management of the asset may subscribe to the cyber security policy
- An organisation that invests public funds in different kinds of securities such as stocks, and government bonds must purchase the cyber security policy
- A government agency selling bonds may opt for a cyber security policy
- Companies that have a significant presence in the investment fund must obtain a cyber security policy
Cyber Security Policy for Investment Funds & Asset Management: Inclusions
The following coverage can be covered in the cyber security policy:
- The insurer shall provide restoration cost of data if lost by any malware attack
- The insurer shall provide coverage for the loss caused due to cyber stalking
- The insurer shall provide coverage for the loss of data due to IT theft
- The insurer shall provide coverage for the financial loss incurred by the insured due to Phishing
- The insurer shall provide coverage against the claim made by a third party
- The insurer shall provide prosecution cost initiated against a third party for cyber breaches
- The insurer shall indemnify the insured against cyber extortion
Cyber Security Policy for Investment Funds & Asset Management: Exclusions
Cyber security policy does not provide any coverage for the following:
- The insurer shall not provide any coverage for bodily injury, damage to the physical property or any disease
- The insurer shall not provide any coverage for the loss incurred due to an electric short circuit
- The insurer shall not provide any damage caused due to the willful act or negligence of the insured
- The insured is not entitled to file a claim for the loss incurred due to deliberate ignorance of the defence
- The insured is not entitled to file a claim for the loss caused due to participation in the malicious activity
- The insured is not entitled to file a claim for the loss caused due to the concealment of important information
Claiming Process for Cyber Security Policy for Investment Funds & Asset Management
Follow the steps in order to raise a claim for investment fund & asset management.
- Step 1: The insured is required to inform the insurer about the cyber incident. The claim must be intimidated soon after being aware of a cyber attack.
- Step 2: The insurer shall deploy or appoint an investigation in order to interpret the severity of the cyber attack and claim
- Step 3: A cyber expert shall be hired if the incident seems to be of severe nature
- Step 4: The investigator shall investigate the incident. The cyber expert shall interpret the loss caused to the insured
- Sept 5: If the insured succeeded in validating the severity of the cyber incident, the insurer shall provide the appropriate damage caused to the insured
Note: The insured must not withhold or conceal any information which is required to be intimidated to the insurer.
Ans: The insured must appraise the insurer about the cyber incident soon after acknowledging such an incident. Time is of the essence in cyber insurance. If the insured fails to inform the insurer within the stipulated time, the claim might be rejected by the insurer. Therefore, the insured must inform the insurer as early as possible.
Que 2: Can an insured avail of a cyber security insurance claim if the loss has been caused to a third party?Ans: One may avail of the claim if the loss has been caused to the third party due to the negligence of the insured. The fund raised by the insured for investment funds & asset management might be stolen due to a cyber attack. Under such circumstances, the insured may file a claim and indemnify the third party.
Que 3: Can an insured avail of the claim if the data of the investment funds & asset management company gets leaked?Ans: Yes, the insurer shall provide coverage for the loss incurred to the insured due to the data leak.
Ans: One may enhance cyber security by following effective measures and allocating a separate budget for cyber security policy.