Cyber insurance in India: Navigating risks and opportunities in a digital economy
October 2023
We, at Deloitte, tried to understand the potential of cyber insurance as a risk mitigation strategy and the challenges inhibiting the growth prospects of this still-emerging market in India. To substantiate our insights and perspectives, we conducted a survey capturing responses from Chief Information Security Officers (CISOs) from a diverse set of India-based companies. The survey helped us gauge their understanding of cyber insurance and willingness to buy a policy. Issues such as ambiguity associated with technical details, the dilemma of pricing a product, and the buyers’ paradox, could explain several of our observations.
The cyber insurance market has evolved over the years to meet the demand for mitigating losses due to cybercrimes. Cyber insurance offerings help entities that are digitising to cover the costs of recovery and damages in the event of cyberattacks. Globally, the size of the cyber insurance market is about US$ 12.83 billion in 2022.8 Over the next seven years, the market will grow at a CAGR of 25.7 percent to US$ 63.62 billion in 2029.
The uptake of cyber insurance appears to be lopsided. Industries with a higher degree of digitisation involved in operations (such as IT, pharma, and manufacturing), or those with more integration and exposure to the rest of the economy (such as supply chain, retail, critical industries, and finance) are often the targets of cyber criminals. These industries are expected to be early adopters of cyber insurance.
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Five steps to unleash the potential of cyber insurance. Although the market will take some time to learn to deal with these uncertainties, some of these measures can help accelerate its progress towards maturity in the order of difficulties to implement.
Summary
Cyber insurance is a niche market and has seen a difficult time lately due to the rising number of breaches and increasing complexities of cybercrimes. In this report, we offered our perspective on the nascent yet highly potent, cyber insurance market in India.
