The Evolution of Cyber Insurance
Introduction
India’s digital growth journey has been moving at a tremendous pace. According to MeitY’s report, India’s digital economy is expected to rise to US$ 500 billion by 2025, up from US$ 200 billion in 2019. The digitisation drive that we are experiencing is likely to foster and boost a favourable business environment that will attract rapid investment and augment economic growth across sectors. This will, in turn, compel businesses to adopt digital platforms as solutions to meet customer expectations. Due to accelerated digitisation, cyber risks often deter business growth. Cybercrimes are becoming more rampant and complex and the costs associated with such breaches are not only increasing but also becoming more systemic.
Development of the Cyber Insurance Landscape
Digitization of businesses started in the 1980s with the use of mainframes. Personal computers entered the game and further modified the landscape from the 2000s along with LANs, the internet and the dot-com boom of the 2000s. In the late 1990s, cyber-insurance was developed as a risk management tool to ensure information security. Coverage was limited, and clients included SMEs in need of insurance to qualify for tenders, or community banks too small to hedge the risks of their online banking operations. The first cyber insurance policy was written in 1997 through AIG, against hacking as a third-party liability policy.
The current trends in the cyber insurance space are focused on the prevention of cyber risks, which by nature are hard to outline and constantly evolving. The result is that the buyers have limited clarity on the types of cyber risks covered under cyber insurance, and even lesser visibility on the scope and amount of optimum coverage. Unfamiliarity with the claim procedure and resolutions, ambiguous claim thresholds during settlements, and confusion around exclusions and coverage of regulatory fines and penalties under a purchased scheme further discourage potential buyers from seriously investing in cyber insurance products.
Key Factors in Cyber Insurance Evolution and Its Role in Risk Management
The cyber insurance market in India has three key influencing factors, namely the speed of achieving digital maturity, government initiatives to digitise and enforce stringent cyber laws, and the evolving landscape with technology giants and MNCs entering the cyber insurance domain. The latter are the catalyst for intensifying competition in this market.
Advancements in technology in terms of AI, machine learning, big data, robotics, blockchain, augmented and virtual reality, and IoT are expected to reshape the insurance industry and help reach untapped audiences in a more digital-forward manner. With the absence of a standard cyber insurance policy, regulators need to take the following variables into consideration while developing cyber insurance policies: the risk insured against, the scope of the loss covered and the limits/ sub-limits.
Challenges
With the complexity of cyber risks increasing exponentially the challenges to counter the same are growing too which is leading to gaps in the coverage offered for cyber threats. Resultantly, the compliance regulations are dependent on the risks which exist and cyber threat actors adopt new technologies faster and exploit them to their benefit. A lack of historical data and predictability in future cyber risks, the possibility of large overwhelming loss events, uncertainties among market participants about what is specifically covered under such policies, and legal battles over fundamental issues are some of the challenges identified.
Future Outlook/ Recommendations
India's cyber infrastructure requires a multi-faceted approach that involves collaboration between government, industry, and academia should be developed. Some recommendations are:
- Risk assessments should be a general practice and the cyber insurance policies should be simplified, clearing the mismatch between the premium paid and insurance coverage and there should be standard verbosity across cyber policy language.
- Promoting R&D tailored to India focused on education programs that have public-private partnerships and global collaborations to share threat intelligence, best practices, and expertise in critical infrastructure protection.
- Cyber insurance can also be promoted as compliance with the DPDP Act, which would lead to better development of cyber infrastructure and cyber hygiene practices.
- Regular updates to cyber insurance policies to ensure relevance and effectiveness. Insurers could create and offer holistic cyber insurance risk management plans.
Conclusion
According to a report by Deloitte in 2023, the cyber insurance market in India is expected to grow by 27-30 per cent in the coming years and it is currently valued at USD 50-60 million, while maintaining a steady 27-30 per cent CAGR in the past three years. The Indian cyber infrastructure’s nature is challenging, however, it offers opportunities for growth, innovation, and collaboration. A proactive approach, supported by robust policies, advanced technologies, and skilled professionals, will be essential to building a resilient cyber infrastructure capable of withstanding evolving threats.
Reference
- https://www2.deloitte.com/content/dam/Deloitte/nl/Documents/financial-services/deloitte-nl-fsi-demystifying-cyber-insurance-coverage-report.pdf
- https://www.dnaindia.com/business/report-what-s-cyber-liablity-insurance-and-why-you-may-need-it-2136556
- https://economictimes.indiatimes.com/industry/banking/finance/insure/cyber-insurance-gains-momentum-in-india-set-to-witness-exponential-growth-deloitte/articleshow/104189297.cms?from=mdr
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Executive Summary:
A picture about the April 8 solar eclipse, which was authored by AI and was not a real picture of the astronomical event, has been spreading on social media. Despite all the claims of the authenticity of the image, the CyberPeace’s analysis showed that the image was made using Artificial Intelligence image-creation algorithms. The total solar eclipse on April 8 was observable only in those places on the North American continent that were located in the path of totality, whereas a partial visibility in other places was possible. NASA made the eclipse live broadcast for people who were out of the totality path. The spread of false information about rare celestial occurrences, among others, necessitates relying on trustworthy sources like NASA for correct information.
Claims:
An image making the rounds through social networks, looks like the eclipse of the sun of the 8th of April, which makes it look like a real photograph.
Fact Check:
After receiving the news, the first thing we did was to try with Keyword Search to find if NASA had posted any lookalike image related to the viral photo or any celestial events that might have caused this photo to be taken, on their official social media accounts or website. The total eclipse on April 8 was experienced by certain parts of North America that were located in the eclipse pathway. A part of the sky above Mazatlan, Mexico, was the first to witness it. Partial eclipse was also visible for those who were not in the path of totality.
Next, we ran the image through the AI Image detection tool by Hive moderation, which found it to be 99.2% AI-generated.
Following that, we applied another AI Image detection tool called Isitai, and it found the image to be 96.16% AI-generated.
With the help of AI detection tools, we came to the conclusion that the claims made by different social media users are fake and misleading. The viral image is AI-generated and not a real photograph.
Conclusion:
Hence, it is a generated image by AI that has been circulated on the internet as a real eclipse photo on April 8. In spite of some debatable claims to the contrary, the study showed that the photo was created using an artificial intelligence algorithm. The total eclipse was not visible everywhere in North America, but rather only in a certain part along the eclipse path, with partial visibility elsewhere. Through AI detection tools, we were able to establish a definite fact that the image is fake. It is very important, when you are talking about rare celestial phenomena, to use the information that is provided by the trusted sources like NASA for the accurate reason.
- Claim: A viral image of a solar eclipse claiming to be a real photograph of the celestial event on April 08
- Claimed on: X, Facebook, Instagram, website
- Fact Check: Fake & Misleading
Introduction
The Ministry of Electronics and Information Technology recently released the IT Intermediary Guidelines 2023 Amendment for social media and online gaming. The notification is crucial when the Digital India Bill’s drafting is underway. There is no denying that this bill, part of a series of bills focused on amendments and adding new provisions, will significantly improve the dynamics of Cyberspace in India in terms of reporting, grievance redressal, accountability and protection of digital rights and duties.
What is the Amendment?
The amendment comes as a key feature of cyberspace as the bill introduces fact-checking, a crucial aspect of relating information on various platforms prevailing in cyberspace. Misformation and disinformation were seen rising significantly during the Covid-19 pandemic, and fact-checking was more important than ever. This has been taken into consideration by the policymakers and hence has been incorporated as part of the Intermediary guidelines. The key features of the guidelines are as follows –
- The phrase “online game,” which is now defined as “a game that is offered on the Internet and is accessible by a user through a computer resource or an intermediary,” has been added.
- A clause has been added that emphasises that if an online game poses a risk of harm to the user, intermediaries and complaint-handling systems must advise the user not to host, display, upload, modify, publish, transmit, store, update, or share any data related to that risky online game.
- A proviso to Rule 3(1)(f) has been added, which states that if an online gaming intermediary has provided users access to any legal online real money game, it must promptly notify its users of the change, within 24 hours.
- Sub-rules have been added to Rule 4 that focus on any legal online real money game and require large social media intermediaries to exercise further due diligence. In certain situations, online gaming intermediaries:
- Are required to display a demonstrable and obvious mark of verification of such online game by an online gaming self-regulatory organisation on such permitted online real money game
- Will not offer to finance themselves or allow financing to be provided by a third party.
- Verification of real money online gaming has been added to Rule 4-A.
- The Ministry may name as many self-regulatory organisations for online gaming as it deems necessary for confirming an online real-money game.
- Each online gaming self-regulatory body will prominently publish on its website/mobile application the procedure for filing complaints and the appropriate contact information.
- After reviewing an application, the self-regulatory authority may declare a real money online game to be a legal game if it is satisfied that:
- There is no wagering on the outcome of the game.
- Complies with the regulations governing the legal age at which a person can engage into a contract.
- The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 have a new rule 4-B (Applicability of certain obligations after an initial period) that states that the obligations of the rule under rules 3 and 4 will only apply to online games after a three-month period has passed.
- According to Rule 4-C (Obligations in Relation to Online Games Other Than Online Real Money Games), the Central Government may direct the intermediary to make necessary modifications without affecting the main idea if it deems it necessary in the interest of India’s sovereignty and integrity, the security of the State, or friendship with foreign States.
- Intermediaries, such as social media companies or internet service providers, will have to take action against such content identified by this unit or risk losing their “safe harbour” protections under Section 79 of the IT Act, which let intermediaries escape liability for what third parties post on their websites. This is problematic and unacceptable. Additionally, these notified revisions can circumvent the takedown order process described in Section 69A of the IT Act, 2000. They also violated the ruling in Shreya Singhal v. Union of India (2015), which established precise rules for content banning.
- The government cannot decide if any material is “fake” or “false” without a right of appeal or the ability for judicial monitoring since the power to do so could be abused to thwart examination or investigation by media groups. Government takedown orders have been issued for critical remarks or opinions posted on social media sites; most of the platforms have to abide by them, and just a few, like Twitter, have challenged them in court.
Conclusion
The new rules briefly cover the aspects of fact-checking, content takedown by Govt, and the relevance and scope of sections 69A and 79 of the Information Technology Act, 2000. Hence, it is pertinent that the intermediaries maintain compliance with rules to ensure that the regulations are sustainable and efficient for the future. Despite these rules, the responsibility of the netizens cannot be neglected, and hence active civic participation coupled with such efficient regulations will go a long way in safeguarding the Indian cyber ecosystem.
Introduction
Iran stands as a nation poised at the threshold of a transformative era. The Islamic Republic, a land of ancient civilisations now grappling with the exigencies of the 21st century, is now making strides in the emerging field of artificial intelligence (AI). This is not merely an adoption of new tools; it is a strategic embrace, a calculated leap into the digital unknown, where the potential for economic growth and security enhancement resonates with the promise of a redefined future.
Embarking on this technological odyssey, Iranian President Ebrahim Raisi, in a conclave with the nation’s virtual business activists, delineated the ‘big steps’ being undertaken in the realm of AI. The gathering, as reported by the pro-government Tasnim News, was not a simple exchange of polite remarks but a profound discourse that offered an incisive overview of the burgeoning digital economy and the strides Iran is making in the AI landscape. The conversation deeply revolved around the current ecosystem of technology and innovation within Iran, delving into the burgeoning startup culture and the commendable drive within its youth populace to propel the nation to the forefront of technology.
Iranian AI Integration
Military Implications
The discourse ranged from the current technological infrastructure to the broader implications for the security and defense of the region. The Iranian polity, with its rich history that seamlessly blends with aspirations for the future, is acutely aware that the implications of AI reach far beyond mere economic growth. They extend into the very fibres of military might and the structure of national security. The investment in cyber capabilities in Iran is well-documented, a display of shrewdness and pragmatism. And the integration of AI technologies is the next logical step in an ever-evolving defense architecture. Brigadier General Alireza Sabahifard, Commander of the Iranian Army Air Defense Force, has underscored the pivotal role of AI in modern warfare. He identifies the ongoing adoption of AI technologies as a strategic imperative, a top priority fundamentally designed to elevate the air defense capabilities in Iran to meet 21st-century threats.
Economic Implications
Yet, the Iranian pursuit of AI is not solely confined to bolstering military prowess. It is also pervasive in nurturing economic opportunity. President Raisi’s rhetoric touches upon economic rejuvenation, job creation, and the proliferation of financial and legal support mechanisms, all blurred into a cohesive vision that would foster a suitable environment for the private sector in the AI domain. The ambition is grand and strikingly clear — a nation committed to training several thousand individuals in the digital economy sector, signaling a deep-rooted commitment to cultivating a healthy environment for AI-driven innovation.
The Iranian leader’s vision extends beyond the simple creation of infrastructure. It extends to the fostering of a healthy, competitive, and peaceful social milieu where domestic and international markets are within easy reach, promoting the prosperity of the digital economy and its activists. Such a vision of technological symbiosis, in many Western democracies, would be labelled as audaciously progressive. In Iran, however, withdrawing a major chunk of economic investments from the country's security state adds layers of complexity and nuance to this transformative narrative.
Cultural Integration
Still, Iran’s ambitious AI journey unfolds with a recognition of its cultural underpinnings and societal structure. The Nexus between the private sector, with its cyber-technocratic visionaries, and the regime, with its omnipresent ties to the Islamic Revolutionary Guard Corps, is a tightrope that requires unparalleled poise and vigilance.
Moreover, in the holy city of Qom, a hub of intellectual fervour and the domicile of half of Iran's 200,000 Shia clerics, there burgeons a captivating interest in the possible synergies between AI and theological study. The clerical establishment, hidden within a stronghold of religious scholarship, perceives AI not as a problem but as a potential solution, a harbinger of progress that could ally with tradition. It sees in AI the potential of parsing Islamic texts with newfound precision, thereby allowing religious rulings, or fatwas, to resonate with the everchanging Iranian society. This integration of technology is a testament to the dynamic interplay between tradition and modernity.
Yet the integration of AI into the venerable traditions of societies such as Iran's is threaded with challenges. Herein lays the paradox, for as AI is poised to potentially bolster religious study, the threat of cultural dissolution remains present. AI, if not judiciously designed with local values and ethics in mind, could inadvertently propagate an ideology at odds with local customs, beliefs, and the cornerstone principles of a society.
Natural Resources
Similarly, Iran's strategic foray into AI extends into its sovereign dominion—the charge of its natural resources. As Mehr News Agency reports, the National Iranian Oil Company (NIOC) is on the cusp of pioneering a joint venture with international tech juggernauts, chiefly Chinese companies, to inject the lifeblood of AI into the heart of its oil and gas production processes. This grand undertaking is nothing short of a digital renaissance aimed at achieving 'great reforms’ and driving a drastic 20% improvement in efficiency. AI’s algorithmic potency, unleashed in the hydrocarbon fields, promises to streamline expenses, enhance efficacy, and maximise production outputs, thereby bolstering Iran's economic bulwark.
The AI way Forward
As we delve further into Iran's sophisticated AI strategy, we observe an approach that is both vibrant and multi-dimensional. From military development to religious tutelage, from the diligent charge of the environment to the pursuit of sustainable economic development, Iran's AI ventures are emblematic of the broader global discourse. They mark a vivid intersection of AI governance, security, and the future of technological enterprise, highlighting the evolution of technological adoption and its societal, ethical, and geopolitical repercussions.
Conclusion
The multifaceted nature of Iran's AI pursuits encapsulates a spectrum of strategic imperatives, bringing the spearheads of defense modernisation and religious academics with the imperatives of resource allocation. It reflects a nuanced approach to the adoption and integration of technology, adjudicating between the venerable pillars of traditional values and the inexorable forces of modernisation. As Iran continues to delineate and traverse its path through the burgeoning landscape of AI, attending global stakeholders, watch with renewed interest and measured apprehension. Mindful of the intricate geopolitical implications and the transformative potential inherent in Iran's burgeoning AI endeavours, the global community watches, waits, and wonders at what may emerge from this ancient civilisation’s bold, resolute strides into the future.
References
- https://www.jpost.com/middle-east/article-792391
- https://www.ft.com/content/9c1c3fd3-4aea-40ab-977b-24fe5527300c
- https://www.foxnews.com/world/iran-looks-ai-weather-western-sanctions-help-military-fight-cheap
