In India, under cyber insurance for individuals, which of the following benefits are generally covered, in addition to payment for the loss of funds and other benefits?
- 1.Cost of restoration of the computer system in case of malware disrupting access to one's computer
- 2.Cost of a new computer if some miscreant wilfully damages it, if proved so
- 3.Cost of hiring a specialized consultant to minimize the loss in case of cyber extortion
- 4.Cost of defence in the Court of Law if any third party files a suit
Select the correct answer using the code given below:
Answer & explanation
Answer: (b) 1, 3 and 4 only
Personal cyber-insurance policies in India pay for restoring data and programs damaged by malware, for security-consultant costs when fighting cyber extortion, and for legal defence costs if a third party makes a claim. They do not pay for a replacement computer, because damage to tangible property is excluded.
- ✓ 1. The cover pays the reasonable and necessary cost to restore, retrieve or reinstall data or programs damaged by malware, including software licences needed to reproduce them.
- ✗ 2. Physical damage to hardware is not covered: policy wordings exclude any damage to or destruction of tangible property. The cover is for data and programs, not the machine.
- ✓ 3. Under the cyber extortion cover the insured is expected to involve a security consultant, with the insurer's prior written consent, to limit the loss; reasonable and necessary costs resulting from the extortion threat are covered.
- ✓ 4. The malware cover pays defence costs if an affected person or entity makes a claim for legal liability arising from malware entering the insured's computer system.
Remember · Personal cyber cover pays for data restoration, extortion-response consultants and legal defence costs, but not for replacing damaged hardware. Always read the policy wording.
Sources
- IRDAI-hosted policy wording: Future Generali India Insurance, Personal Cyber Risk Policy (UIN IRDAN132RP0001V01202021) ↗ “Reasonable and necessary Cost to technically restore, retrieve or reinstall Data or Computer Program damaged by entry of the Malware including the Cost of purchasing a Software License necessary to reproduce such Data or Computer Programs … take all reasonable steps (including the involvement of a security consultant with the Insurer’s prior written consent), to effectively mitigate the Cyber Extortion Loss. … Defence Costs incurred as a result of any Claim by an Affected Person or an Entity for Legal liability that directly results from the Damage caused by entry of Malware into the Insured’s Computer System.”
- IRDAI-hosted policy wording: Bajaj Allianz General Insurance, Individual Cyber Safe Insurance Policy ↗ “Property Damage Any damage to or destruction of any tangible property, including loss of use thereof.”
Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). ·