According to an online survey by Policybazaar, there is a huge market opportunity especially in Tier-2 and 3 cities for new age insurance products like cyber insurance.
The findings showed that around 23% of the respondents had a cyber insurance policy. This represents a significant proportion of cyber security coverage in a country like India where penetration of fundamental products such as life and health insurance is still low.
Policybazaar conducted the survey for a rapid analysis of consumer awareness levels and emerging security products in India to observe National Insurance Awareness Day 2022. The brand surveyed over 4500 of its customers and app/website visitors about relatively little-known products including cyber insurance. Mental health insurance, home insurance and pet insurance.
The overall findings of the survey showed a huge scope for awareness and purchase consideration for these products with the exception of cyber insurance.
Another notable trend observed here is that in Tier 2 and 3 cities around 48% of the respondents showed willingness to buy or buy insurance, while 36% in Tier-1 cities had bought it. The results clearly draw a parallel between rising Internet consumption in India’s smaller cities and the same level of awareness to safeguard that consumption.
According to the findings of the survey, although still in its infancy, cyber insurance appears to be the next big opportunity for the insurance industry. The highest number of respondents from Tier-2 and 3 cities, at 31% and 29%, respectively, indicated that Tier-1 cities have a tendency to buy cyber insurance as opposed to 16%. However, among those who actually bought the policy, 20% of the respondents were from tier-1 cities, while 17% were from tier-2 and tier-3 cities. The figures represent a growing level of awareness across India to effectively deal with intangible threats to critical digital assets.
Besides the potential opportunities in smaller towns, another interesting trend that emerged was the inclination towards buying family cyber security plans. While maximum 45% of the insured customers bought family plans, 35% covered individual and 20% under corporate plans. Not only this, 53 percent of non-buyers also showed interest in buying a family plan, which is the highest. This implies a clear priority not only for individual cyber security, but for the overall comprehensive security of the entire family.
However, it cannot be denied that there is still scope for coverage here. About 20% of the total respondents had suffered financial loss due to cybercrime and only 24% of them ended up buying the policy and 39% neither bought nor considered buying one. Financial loss due to unauthorized transactions emerged as a threat that majority of the respondents (57%) wanted to cover through cyber insurance.