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What is the story about?
As the world observes Data Privacy Day on January 28, experts across insurance, cybersecurity, fintech and crypto warn that cyber frauds are accelerating in scale and complexity, exposing individuals and organisations to financial, operational and reputational risks.
The trend has pushed cyber insurance from a niche offering into a critical component of digital risk management.
Why are cyber frauds increasing?
According to Mohd. Arif Khan, Deputy CEO of SBI General Insurance, the migration of everyday activities to digital platforms has
fundamentally altered the threat landscape.
Fraudsters increasingly exploit human behaviour through social engineering, identity impersonation and misuse of personal data, rather than relying only on technical vulnerabilities.
This shift has made cybercrime more frequent and harder to detect, particularly for individuals.
Highlighting the payments ecosystem, Ankit Gupta, Business Head – Cyber Insurance at Policybazaar for Business, said the rapid expansion of UPI, card usage and mobile payments has created frictionless convenience but also widened exposure to frauds such as phishing, vishing and unauthorised transactions.
As digital financial activity grows, so does the financial impact of cyber incidents on households.
From a consulting perspective, Raghavendra BV, Partner and Deputy Leader, Cybersecurity Consulting at EY India, pointed out that cyber-attacks have become more coordinated and financially damaging for enterprises. Leaders often have to respond under intense pressure while managing multiple vendors, regulatory obligations and operational continuity, amplifying the cost and complexity of incidents.
Looking at the technology threat environment, Rahil Patel, Chief Growth Officer at QNu Labs, said attackers are now using AI-driven automation, deepfakes and crypto-enabled ecosystems, while many organisations continue to depend on legacy cryptographic systems. This widening capability gap has accelerated the scale and speed of successful attacks.
In the crypto sector, Sathvik Vishwanath, Co-Founder and CEO of Unocoin, noted that the irreversible nature of blockchain transactions magnifies risk. A single vulnerability in wallets, smart contracts or key management can result in irreversible losses within minutes, making crypto platforms especially attractive targets.
How is cyber insurance addressing these risks?
Khan said cyber insurance has evolved into a holistic recovery framework for individuals. Beyond covering financial losses, policies now offer legal support, access to IT experts for breach investigation and data restoration, and protection against repeat attacks.
Some covers also address the psychological and livelihood impact of cybercrime through counselling and wage-loss support.
For households and small businesses, Ankit Gupta explained that cyber insurance acts as a digital safety net, covering direct financial losses and providing structured recovery assistance, including fraud investigation costs, legal fees and third-party liability arising from data breaches.
At an organisational level, Raghavendra BV said cyber insurance enables faster and more decisive response during attacks by removing uncertainty around recovery costs. Coverage allows companies to deploy external specialists, secure temporary infrastructure and maintain critical operations, which directly supports business continuity and stakeholder confidence.
Tarun Wig, Co-Founder and CEO of Innefu Labs, added that cyber insurance helps absorb the multi-dimensional shock of cyber incidents by covering forensic investigations, regulatory compliance costs, crisis communication and business interruption.
This support allows leadership teams to focus on stabilising operations instead of making reactive financial decisions.
In digital-first businesses, Atul Monga, CEO and Co-Founder of BASIC Home Loan, said cyber insurance reinforces consumer trust by ensuring that sensitive financial data is protected and that service continuity is maintained even during incidents.
From an operational standpoint, Sarika Shetty, Co-Founder and CEO of RentenPe, said cyber insurance helps digital payment companies replace lost income during system downtime and continue meeting fixed obligations such as salaries and rent, while also supporting regulatory and recovery expenses.
However, Rahil Patel cautioned that insurance remains a reactive instrument. While it enables recovery, it cannot substitute for proactive security investments, particularly as quantum-era threats loom.
In the crypto economy, Sathvik Vishwanath said cyber insurance signals maturity and resilience, helping platforms manage regulatory exposure, recover faster from breaches, and maintain user and investor confidence.
The trend has pushed cyber insurance from a niche offering into a critical component of digital risk management.
Why are cyber frauds increasing?
According to Mohd. Arif Khan, Deputy CEO of SBI General Insurance, the migration of everyday activities to digital platforms has
This shift has made cybercrime more frequent and harder to detect, particularly for individuals.
Highlighting the payments ecosystem, Ankit Gupta, Business Head – Cyber Insurance at Policybazaar for Business, said the rapid expansion of UPI, card usage and mobile payments has created frictionless convenience but also widened exposure to frauds such as phishing, vishing and unauthorised transactions.
As digital financial activity grows, so does the financial impact of cyber incidents on households.
From a consulting perspective, Raghavendra BV, Partner and Deputy Leader, Cybersecurity Consulting at EY India, pointed out that cyber-attacks have become more coordinated and financially damaging for enterprises. Leaders often have to respond under intense pressure while managing multiple vendors, regulatory obligations and operational continuity, amplifying the cost and complexity of incidents.
Looking at the technology threat environment, Rahil Patel, Chief Growth Officer at QNu Labs, said attackers are now using AI-driven automation, deepfakes and crypto-enabled ecosystems, while many organisations continue to depend on legacy cryptographic systems. This widening capability gap has accelerated the scale and speed of successful attacks.
In the crypto sector, Sathvik Vishwanath, Co-Founder and CEO of Unocoin, noted that the irreversible nature of blockchain transactions magnifies risk. A single vulnerability in wallets, smart contracts or key management can result in irreversible losses within minutes, making crypto platforms especially attractive targets.
How is cyber insurance addressing these risks?
Khan said cyber insurance has evolved into a holistic recovery framework for individuals. Beyond covering financial losses, policies now offer legal support, access to IT experts for breach investigation and data restoration, and protection against repeat attacks.
Some covers also address the psychological and livelihood impact of cybercrime through counselling and wage-loss support.
For households and small businesses, Ankit Gupta explained that cyber insurance acts as a digital safety net, covering direct financial losses and providing structured recovery assistance, including fraud investigation costs, legal fees and third-party liability arising from data breaches.
At an organisational level, Raghavendra BV said cyber insurance enables faster and more decisive response during attacks by removing uncertainty around recovery costs. Coverage allows companies to deploy external specialists, secure temporary infrastructure and maintain critical operations, which directly supports business continuity and stakeholder confidence.
Tarun Wig, Co-Founder and CEO of Innefu Labs, added that cyber insurance helps absorb the multi-dimensional shock of cyber incidents by covering forensic investigations, regulatory compliance costs, crisis communication and business interruption.
This support allows leadership teams to focus on stabilising operations instead of making reactive financial decisions.
In digital-first businesses, Atul Monga, CEO and Co-Founder of BASIC Home Loan, said cyber insurance reinforces consumer trust by ensuring that sensitive financial data is protected and that service continuity is maintained even during incidents.
From an operational standpoint, Sarika Shetty, Co-Founder and CEO of RentenPe, said cyber insurance helps digital payment companies replace lost income during system downtime and continue meeting fixed obligations such as salaries and rent, while also supporting regulatory and recovery expenses.
However, Rahil Patel cautioned that insurance remains a reactive instrument. While it enables recovery, it cannot substitute for proactive security investments, particularly as quantum-era threats loom.
In the crypto economy, Sathvik Vishwanath said cyber insurance signals maturity and resilience, helping platforms manage regulatory exposure, recover faster from breaches, and maintain user and investor confidence.
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