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On September 14, 2024
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Insurers Offer Cover Against Cyberfraud For As Low As Rs 3 Per Day - News18
The insurance covers are made available for Rs 3 per day and are built to provide safety from identity theft, cyber extortion and online bullying. Nowadays, we have everything at our fingertips. We can do almost anything, be it shopping, meeting people, going out with friends, food, movies and millions of other things, with a tap of our fingers. But with the prevalence of technology, the dangers and incidents of cybercrimes are increasing at an alarming rate, especially financial frauds and deepfake videos. So, insurance companies have come up with "cyber covers," which aim to protect from cybercrime. According to the information given, the insurance companies are now opting for small cyber security covers called Sachet Covers, specifically designed to protect against the threats of cyber fraud. The insurance covers are made available for Rs 3 per day and are built to provide safety from identity theft, cyber extortion and online bullying. How is cyber fraud conducted? According to a report in The Times Of India, cybercriminals are experts in impersonating the closest to us and even company executives. It could include family members or senior company executives, while the impersonation is done through fake videos, voice clones or text messages, which are created with a software known as Generative AI. This software is infamous for creating alarmingly real-looking videos and audio. According to Parthanil Ghosh, the director of HDFC ERGO General Insurance, "Fraudsters are indulging in illegal activities by making pictures, videos and sounds like real with the help of AI." A Deloitte report stated that India's cyber insurance market is expected to see a growth of 27 to 30 per cent, in the next five years. In 2023, it stood at 50 to 60 million dollars, the reports added. Since the market and the risks associated with it are continuously growing, the insurance coverage for AI-based fraud is being considered by the companies. Earlier, the cyber-related risks were limited to SMS phishing, fraudulent calls and OTP theft but now, people are more cautious of these methods, giving the cybercriminals a way to evolve. The Lockton India CEO, Sandeep Dadia states, "The risks with Gen AI have now moved beyond financial loss to reputational damage and emotional stress generated by harassment."
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'Sachet' covers now guard against cyber fraudsters using AI
A recent study by Deloitte said that India's cyber insurance market worth $50-60 million in 2023 is expected to grow at an annual rate of 27-30% in the next five years.Insurance companies are building a slew of sachet-sized products that offer protection against growing instances of cyber fraud. These risk covers, some costing as low as Rs 3 per day, are designed to insure individuals and businesses against the threat of impersonation, cyber extortion, bullying and identity theft that are on the rise in an AI-driven environment, industry executives said. The typical modus operandi for cyber frauds is to use fake videos, voice clones, or text messages impersonating executives, family members, or trusted authorities. "(Fraudsters) are using the ability of GenAI to create hyper-realistic video, photos, audio to impersonate individuals and indulge in illegal activities," said Parthanil Ghosh, Director at HDFC ERGO General Insurance, which has launched a cyber sachet insurance policy covering both businesses and individuals against malware and ransomware cyber-attacks. A recent study by Deloitte said that India's cyber insurance market worth $50-60 million in 2023 is expected to grow at an annual rate of 27-30% in the next five years. "As the market and associated risks continue to evolve, coverage for AI-based social engineering attacks is often provided with sub-limited covers," according to Gaurav Arora, chief of corporate underwriting, claims & property at ICICI Lombard. Evolving Risks Previously, technology-based risks centred around SMS phishing, fraud calls, OTP thefts. "(These) are no longer working for attackers as the public is fairly aware of such primitive methods," said Sandeep Dadia, CEO at insurance broking company Lockton India. "Now, with GenAI the risks go beyond financial loss towards reputational loss, emotional distress caused by harassment," he added. Experts are of the view that the Digital Personal Data Protection Act will also form a strong basis of legal protection. "Organisations are now directly accountable for breach of personal data which has caused harm to any individual," Dadia said. Prevention better than cure As AI continues to advance, leading to greater accuracy in deep fake videos, traditional methods of authentication, such as voice and facial recognition, become less reliable. Deep fakes closely mimic the original voices and mannerisms of the individuals being impersonated. HDFC's Ghosh said that due to constant evolution of technology, it becomes daunting to detect such frauds. His company conducts regular training to sensitise employees about potential cyber threats and how to identify deepfakes. ICICI's Arora said that besides insurance protection, organisations must implement multi-factor authentication to secure financial transactions and access to sensitive data, deploy AI-based detection tools to identify deep fakes and anomalies in communication.
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Insurance companies in India are now offering low-cost cyber insurance policies to protect individuals against the rising threat of AI-powered cyber fraud. These 'sachet' policies are priced as low as Rs. 3 per day, making digital security accessible to a wider population.
In a significant development for digital security, insurance companies in India are now offering low-cost cyber insurance policies, some priced as low as Rs. 3 per day. These 'sachet' policies are designed to protect individuals against the growing threat of cyber fraud, particularly those powered by artificial intelligence (AI) 1.
The introduction of these affordable policies comes at a crucial time when cyber fraud cases are on the rise. According to recent data from the National Crime Records Bureau, India witnessed over 65,000 cyber fraud cases in 2022 alone 2. The increasing sophistication of fraudsters, aided by AI technologies, has made it imperative for individuals to have some form of protection against potential financial losses.
These new policies offer coverage for a range of cyber threats, including phishing, malware attacks, and identity theft. The coverage typically extends to financial losses resulting from unauthorized online transactions, with sum insured ranging from Rs. 50,000 to Rs. 5 lakh [1]. Some policies also provide additional benefits such as legal assistance and psychological counseling for victims of cyber fraud.
The affordability of these policies is a game-changer in the realm of digital security. By offering coverage for as little as Rs. 3 per day, insurers are making it possible for a wider section of the population to protect themselves against cyber risks. This move is particularly significant in India, where digital adoption is rapidly increasing but awareness about cyber security remains relatively low [2].
While AI is being used by fraudsters to create more sophisticated scams, it's also being employed by insurance companies to enhance their fraud detection capabilities. Some insurers are using AI to analyze patterns in cyber fraud cases, helping them to refine their policies and offer more targeted protection to consumers [2].
Several major insurance companies in India, including ICICI Lombard, Bajaj Allianz General Insurance, and HDFC Ergo, have launched these affordable cyber insurance products. The industry expects a significant uptake in these policies, given the increasing awareness about cyber risks and the attractive pricing [1].
As digital transactions continue to grow in India, the demand for such cyber insurance products is likely to increase. Industry experts predict that these 'sachet' policies could play a crucial role in creating a more secure digital ecosystem in the country, providing a safety net for millions of digital users against the ever-evolving landscape of cyber threats.
Reference
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Malicious AI models like FraudGPT and WormGPT are becoming the latest tools for cybercriminals, posing significant risks to online security. These AI systems are being used to create sophisticated phishing emails, malware, and other cyber threats.
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Artificial Intelligence is reshaping the banking and financial services sector, offering new opportunities for growth and efficiency while also presenting emerging risks. This story explores the impact of AI in ASEAN markets and beyond, highlighting both the potential benefits and challenges.
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Trend Micro introduces a comprehensive cybersecurity solution to protect consumers and enterprises against AI-generated threats, including deepfakes. The new suite combines advanced technologies to detect and prevent sophisticated cyberattacks.
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IBM's latest report shows that the average cost of a data breach in India has reached a record ₹195 million in 2024. The study highlights the growing financial impact of cybersecurity incidents on Indian businesses.
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As AI technology advances, it's creating new challenges in liability insurance while simultaneously offering potential solutions for streamlining the health insurance industry. This dual impact highlights the complex relationship between AI and the insurance sector.
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