India is experiencing a digital revolution but this transformation comes with its own challenges, such as the surge in cybercrimes. Recent data reveal a troubling trend: between January and April of this year, Indian citizens suffered financial losses exceeding Rs 1,750 crore due to various cyber offenses. During the same period, more than 7,40,000 complaints were filed on the National Cybercrime Reporting Portal. It is thus encouraging that insurance companies are now offering policies to safeguard people against cyber fraud. Cyber insurance, available for both corporates and individuals, essentially provides a financial buffer against the crippling costs associated with data breaches and cyber-attacks and can be customised as per the requirement. Unauthorised transactions involving bank accounts, credit or debit cards — these already have a level of protection from banks — are covered and people can even insure themselves against cyber-bullying too. But what is not insured are cases of fraud where there is active participation of the victim — that is, say, if a person falls
prey to a hoax call and sends money or personal details oneself. This is termed as ‘gross negligence’ by insurance companies and is excluded from coverage. The digitisation of public services is progressing at an explosive pace but people’s awareness of the perils of the process remains sketchy. Can the consumer then be blamed for being unable to tell real from fake? This aspect must be taken into consideration by insurance companies and policy regulators.

Prevention though is better than retrieving losses. India boasts the second-largest population of active internet users. Yet most of them remain inadequately informed about online fraud, leaving them vulnerable to scammers. Threats such as privacy violations and sextortion are also becoming increasingly common. In this rapidly evolving digital world, it is crucial to develop a thorough understanding of cyber risks and take steps to counter them. Awareness campaigns are essential, particularly for new and younger internet users. At the same time, legal gaps must be addressed to prevent such crimes — the Digital Personal Data Protection Data Act passed in 2023 is not enough to protect Indians. There, though, must be a balance between preventing cybercrimes and avoiding excessive regulation. Policy must keep this dimension in mind while framing deterrents.