Protecting Policyholders in the Digital Age
Introduction
The insurance industry is a target for cybercriminals due to the sensitive nature of the information it holds. This makes it essential for insurance companies to have robust cybersecurity measures to protect their data and customers’ personal information.
Cyber fraud in India’s insurance industry is increasing. It is reported that the Indian insurance sector has witnessed a surge in cyber-attacks, with several instances of data breaches, identity thefts, and financial fraud being reported. These cybercrimes not only pose a significant threat to the financial stability of the insurance industry but also to the privacy and security of policyholders.
Cyber Frauds in the Insurance Industry
The insurance industry in India has been the target of increasing cyber fraud in recent years. With the growing digital transformation trend, insurance companies have become increasingly vulnerable to cyber-attacks. Cyber frauds in the insurance industry are initiated by hackers who use various techniques such as phishing, malware, ransomware, and social engineering to gain unauthorised access to policyholders’ personal data and sensitive information
Kinds of cyber frauds in the insurance industry
It is essential for insurers and policyholders alike to be aware of these kinds of cyber-attacks on insurance companies in today’s digital age. Staying educated about these threats can help prevent them from happening in the future.
Identity theft– One common type of cyber fraud that occurs in the insurance industry is identity theft. In this type of fraud, criminals steal personal information such as name, address, date of birth and social security numbers through phishing emails or fraudulent websites. They then use this information to open fraudulent policies or access existing ones.
Payment fraud- Another type of cyber fraud that is on the rise is payment fraud. In this type of fraud, hackers intercept electronic payments made by policyholders or agents using fake bank accounts or compromised payment gateways. The money is then siphoned into untraceable accounts, making it difficult for law enforcement agencies to identify and arrest the perpetrators.
Phishing attacks- Where the fraudsters posed as company officials and sent emails to policyholders requesting their account details. The unsuspecting customers fell for this scam and shared their sensitive information, which was then used to access their accounts and steal funds.
Hacking- Where hackers breach the company’s system to gain access to policyholder data. The hackers’ stoles personal records, including names, addresses, phone numbers, social security numbers, and financial information, which they later sell on the dark web.
Fake policies scam- Fraudsters create fake policies using stolen identities and collect premiums from innocent customers. The insurer then voided these policies due to fraudulent activity leaving those people without valid coverage when they needed it most. The victims suffer significant financial losses due to this scam.
Fake Insurance Websites- Discuss the creation of deceptive websites that imitate well-known insurance companies, where unsuspecting individuals provide their personal details, leading to identity theft or financial losses.
Prevention of Cyber Frauds in the Insurance Industry- Best practices to follow
Prevention is better than cure, which also holds true in the case of cyber fraud in the insurance industry. The industry must take proactive steps to prevent such frauds from occurring in the first place. One of the most effective ways to do so is by investing in cybersecurity measures that are specifically designed for the insurance sector.
Insurance companies must conduct regular employee training programs on cybersecurity best practices. This includes educating employees on how to identify and avoid phishing emails, create strong passwords, and recognise potential cyber threats. Companies should also establish a reporting mechanism for employees to report suspicious activity or incidents immediately.
Having proper access controls in place is also necessary. This means limiting access to sensitive data only to those employees who need it, implementing two-factor authentication, and regularly monitoring user activity logs. Regular audits can also provide an extra layer of protection against potential threats by identifying vulnerabilities that may have been overlooked during routine security checks.
Another essential step is encrypting all data transmitted between different systems and devices. Encryption scrambles data into unreadable codes that can only be deciphered using a decryption key, making it difficult for hackers to intercept or steal information in transit.
Legal Framework for Cyber Frauds in the Insurance Industry
The legal framework for cyber fraud in the insurance industry is critical to preventing such crimes. The Insurance Regulatory and Development Authority of India (IRDAI) has issued guidelines for insurers to establish a cybersecurity framework. The guidelines require insurers to conduct regular risk assessments, implement security measures, and ensure compliance with data privacy laws.
The Information Technology Act 2000, is another significant piece of legislation dealing with cyber fraud in India. The act defines offences such as unauthorised access to a computer system, hacking, and tampering with data. It also provides for stringent penalties and imprisonment for those found guilty of such offences.
The IRDAI’s guidelines provide insurers with a roadmap to establish robust cybersecurity measures to help prevent cyber fraud in the insurance industry. Stringent implementation of these guidelines will go a long way in safeguarding sensitive customer information from falling into the wrong hands.
Best Practices for Insurers and Policyholders
Insurers:
Implementing Strong Authentication: Encouraging the use of multi-factor authentication and secure login processes to safeguard customer accounts and prevent unauthorised access.
Regular Employee Training: Conduct cybersecurity awareness programs to educate employees about the latest threats and preventive measures.
Investing in Advanced Technologies: Utilizing robust cybersecurity tools and systems to promptly detect and mitigate potential cyber threats.
Policyholders:
Vigilance and Awareness: Policyholders must stay vigilant while sharing personal information online and verify the authenticity of insurance websites and communication channels.
Regular Updates and Patches: Advising individuals to keep their devices and software up to date to minimise vulnerabilities that cybercriminals can exploit.
Secure Online Practices: Encouraging the use of strong and unique passwords, avoiding sharing sensitive information on unsecured networks, and exercising caution when clicking on suspicious links or attachments.
Conclusion
As the Indian insurance industry embraces digitisation, the risk of cyber scams and data breaches becomes a significant concern. Insurers and policyholders must collaborate to ensure robust cybersecurity measures are in place to protect sensitive information and financial interests.
It is essential for insurance companies to invest in robust cybersecurity measures that can detect and prevent fraud attempts. Additionally, educating employees on the dangers of cyber fraud and implementing strict compliance measures can go a long way in mitigating risks. With these efforts, the insurance industry can continue to provide trustworthy and reliable services to its customers while protecting against cyber threats. As technology continues to evolve, it is imperative that the insurance industry adapts accordingly and remains vigilant against emerging threats.
Related Blogs
.webp)
Introduction
The Digital Personal Data Protection (DPDP) Act, of 2023, introduces a framework for the protection of personal data in India. Data fiduciaries are the entity that essentially determines the purpose and means of processing of personal data. The small-scale industries also fall within the ambit of the term. Startups/Small companies and Micro, Small, and Medium Enterprises (MSMEs) while determining the purpose of processing of personal data in the capacity of ‘data fiduciary’ are also required to comply with the DPDP Act provisions. The obligations set for the data fiduciary will apply to them unilaterally, though compliance with this Act and can be challenging due to resource constraints and limited expertise in data protection.
DPDP Act, 2023 Section 17(3) gives power to the Central Government to exempt Startups from being obligated to comply with the Act, taking into account the volume and nature of personal data processed. It is the nation's first standalone law on data protection and privacy, which sets forth strict rules on how data fiduciaries can collect and process personal data, focusing on consent-based mechanisms and personal data protection. Small-scale industries are given more time to comply with the DPDP Act. The detailed provisions to be notified in further rulemaking called ‘DPDP rules’.
Obligations on Data Fiduciary under the DPDP Act, 2023
The DPDP Act focuses on processing digital personal data in a manner that recognizes both the right of individuals to protect their personal data and the need to process such personal data for lawful purposes and for matters connected therewith or incidental thereto. Hence, small-scale industries also need to comply with provisions aimed at protecting digital personal data.
The key requirements to be considered:
- Data Processing Principles: Ensuring that data processing is done lawfully, fairly, and transparently. Further, the collection and processing of personal data is only for specific, clear, and legitimate purposes and only the data necessary for the stated purpose. Ensuring that the data is accurate and up to date is also necessary. An important part is that the data is not retained longer than necessary and appropriate security measures are taken to protect the said data.
- Consent Management: Clear and informed consent should be obtained from individuals before collecting their personal data. Further, individuals have the option to withdraw their consent easily.
- Rights of Data Principals: Data principals (individuals) whose data is being collected have the right to Information, the right to correction and erasure of data, the right to grievance redressa, Right to nominate.the right to access, correct, and delete their personal data. Data fiduciaries need to be mindful of mechanisms to handle requests from data principals regarding their concerns.
- Data Breach Notifications: Data fiduciaries are required to notify the data protection board and the affected individuals in case a data breach has occurred.
- Appropriate technical and organisational measures: A Data Fiduciary shall implement appropriate technical and organisational measures to ensure effective observance of the provisions of this Act and the rules made thereunder.Cross-border Data Transfers: Compliance with regulations in relation to the transfer of personal data outside of India should be ensured.
Challenges for Small Scale Industries for the DPDP Act Compliance
While small-scale industries have high aims for their organisational growth and now in the digital age they also need to place reliance on online security measures and handling of personal data, with the DPDP act in the picture it becomes an obligation to consider and comply with. As small-scale industries including MSMEs, they might face certain challenges in fulfilling these obligations but digital data protection measures will also boost the competitive market and customer growth in their business. Bringing reforms in methods aimed at better data governance in today's digital era is significant.
One of the major challenges for small-scale industries could be ensuring a skilled workforce that understands and educates internal stakeholders about the DPDP Act compliances. This could undoubtedly become an additional burden.
Further, the limited resources can make the implementation of data protection, which is oftentimes complex for a layperson in the case of a small-scale industry, difficult to implement. Limitations in resources are often financial or human resources.
Cybersecurity, cyber awareness, and protection from cyber threats need some form of expertise, which is lacking in small enterprises. The outsourcing of such expertise is a decision that is sometimes taken too late, and some form of harm can take place between the periods by which an incident can occur.
Investment in the core business or enterprise many times doesn't include technology other than the basic requirements to run the business, nor towards ensuring that the data is secure and all compliances are met. However, in the fast-moving digital world, all industries need to be mindful of their efforts to protect personal data and proper data governance.
Recommendations
To ensure the proper and effective personal data handling practices as per the provisions of the act, the small companies/startups need to work backend and frontend and ensure that they take adequate measures to comply with the act. While such industries have been given more time to ensure compliance, there are some suggestions for them to be compliant with the new law.
Small companies can ensure compliance with the DPDP Act by implementing robust data protection policies, investing in and providing employee training on data privacy, using age-verification mechanisms, and adopting privacy-by-design principles. Conduct a gap analysis to identify areas where current practices fall short of DPDP Act requirements. Regular audits, secure data storage solutions, and transparent communication with users about data practices are also essential. Use cost-effective tools and technologies for data protection and management.
Conclusion
Small-scale industries must take proactive steps to align with the DPDP Act, 2023 provisions. By understanding the requirements, leveraging external expertise, and adopting best practices, small-scale industries can ensure compliance and protect personal data effectively. In the long run, complying with the new law would lead to greater trust and better business for the enterprises, resulting in a larger revenue share for them.
References
- https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1959161
- https://www.financialexpress.com/business/digital-transformation-dpdp-act-managing-data-protection-compliance-in-businesses-3305293/
- https://economictimes.indiatimes.com/tech/technology/big-tech-coalition-seeks-12-18-month-extension-to-comply-with-indias-dpdp-act/articleshow/104726843.cms?from=mdr
Introduction
Cert-In (Indian Computer Emergency Response Team) has recently issued the “Guidelines on Information Security Practices” for Government Entities for Safe & Trusted Internet. The guideline has come at a critical time when the Draft Digital India Bill is about to be released, which is aimed at revamping the legal aspects of Indian cyberspace. These guidelines lay down the policy framework and the requirements for critical infrastructure for all government organisations and institutions to improve the overall cyber security of the nation.
What is Cert-In?
A Computer Emergency Response Team (CERT) is a group of information security experts responsible for the protection against, detection of and response to an organisation’s cybersecurity incidents. A CERT may focus on resolving data breaches and denial-of-service attacks and providing alerts and incident handling guidelines. CERTs also conduct ongoing public awareness campaigns and engage in research aimed at improving security systems. The Ministry of Electronics and Information Technology (MeitY) oversees CERT-In. It regularly releases alerts to help individuals and companies safeguard their data, information, and ICT (Information and Communications Technology) infrastructure.
Indian Computer Emergency Response Team (CERT-In) has been established and appointed as national agency in respect of cyber incidents and cyber security incidents in terms of the provisions of section 70B of Information Technology (IT) Act, 2000.
CERT-In requests information from service providers, intermediaries, data centres, and body corporates to coordinate reaction actions and emergency procedures regarding cyber security incidents. It is a focal point for incident reporting and offers round-the-clock security services. It manages cyber occurrences that are tracked and reported while continuously analysing cyber risks. It strengthens the security barriers for the Indian Internet domain.
Background
India is fast becoming one of the world’s largest connected nations – with over 80 Crore Indians (Digital Nagriks) presently connected and using the Internet and cyberspace – and with this number is expected to touch 120 Crores in the coming few years. The Digital Nagriks of the country are using the Internet for business, education, finance and various applications and services including Digital Government services. Internet provides growth and innovation and at the same time it has seen rise in cybercrimes, user harm and other challenges to online safety. The policies of the Government are aimed at ensuring an Open, Safe & Trusted and Accountable Internet for its users. Government is fully cognizant and aware of the growing cyber security threats and attacks.
It is the Government of India’s objective to ensure that Digital Nagriks experience a Safe & Trusted Internet. Along with ubiquitous applications of Information & Communication Technologies (ICT) in almost all facets of service delivery and operations, continuously evolving cyber threats have become a concern for the Government. Cyber-attacks can come in the form of malware, ransomware, phishing, data breach etc., that adversely affect an organisation’s information and systems. Cyber threats leading to cyber-attacks or incidents can compromise the confidentiality, integrity, and availability of an organisation’s information and systems and can have far reaching impact on essential services and national interests. To protect against cyber threats, it is important for government entities to implement strong cybersecurity measures and follow best practices. As ICT infrastructure of the Government entities is one of the preferred targets of the malicious actors, responsibility of implementing good cyber security practices for protecting computers, servers, applications, electronic systems, networks, and data from digital attacks, also remain with the ICT assets’ owner i.e. Government entity.
What are the new Guidelines about?
The Government of India (distribution of business) Rules, 1961’s First Schedule lists a number of Ministries, Departments, Secretariats, and Offices, along with their affiliated and subordinate offices, which are all subject to the rules. They also comprise all governmental organisations, businesses operating in the public sector, and other governmental entities under their administrative control.
“The government has launched a number of steps to guarantee an accessible, trustworthy, and accountable digital environment. With a focus on capabilities, systems, human resources, and awareness, we are extending and speeding our work in the area of cyber security, according to Rajeev Chandrasekhar, Minister of State for Electronics, Information Technology, Skill Development, and Entrepreneurship.
The Recommendations
- Various security domains are covered in the standards, including network security, identity and access management, application security, data security, third-party outsourcing, hardening procedures, security monitoring, incident management, and security audits.
- For instance, the rules advise using only a Standard User (non-administrator) account to use computers and laptops for regular work regarding desktop, laptop, and printer security in the workplace. Users may only be granted administrative access with the CISO’s consent.
- The usage of lengthy passwords containing at least eight characters that combine capital letters, tiny letters, numerals, and special characters; Never save any usernames or passwords in your web browser. Likewise, never save any payment-related data there.
- They include guidelines created by the National Informatics Centre for Chief Information Security Officers (CISOs) and staff members of Central government Ministries/Departments to improve cyber security and cyber hygiene in addition to adhering to industry best practises.
Conclusion
The government has been proactive in the contemporary times to eradicate the menace of cybercrimes and therreats from the Indian cyberspace and hence now we have seen a series of new bills and polices introduced by the Ministry of Electronics and Information Technology, and various other government organisations like Cert-In and TRAI. These policies have been aimed towards being relevant to time and current technologies. The threats from emerging technologies like web 3.0 cannot be ignored and hence with active netizen participation and synergy between government and corporates will lead to a better and improved cyber ecosystem in India.
Introduction
The Department of Telecommunications (DoT) has launched the 'Digital Intelligence Platform (DIP)'and the 'Chakshu' facility on the Sanchar Saathi portal to combat cybercrimes and financial frauds. Union telecom, IT and railways minister Ashwini Vaishnaw announced the initiatives, stating that the government has been working to counter cyber frauds at national, organizational, and individual levels. The Sanchar Saathi portal has successfully tackled such attacks, and the two new portals will further enhance the capacity to check any kind of cyber security threat.
The Digital Intelligence Platform is a secure and integrated platform for real-time intelligence sharing, information exchange, and coordination among stakeholders, including telecom operators, law enforcement agencies, banks, financial institutions, social media platforms, and identity document issuing authorities. It also contains information regarding cases detected as misuse of telecom resources.
The 'Chakshu' facility allows citizens to report suspected fraud communication received over call, SMS, or WhatsApp with the intention of defrauding, such as KYC expiry, bank account/payment wallet/SIM/gas connection/electricity connection, sextortion, impersonations a government official/relative for sending money, and disconnection of all mobile numbers by the Department of Telecommunications.
The launch of these proactive initiatives or steps represents another significant stride by the Ministry of Communications and the Department of Telecommunications in combating cybersecurity threats to citizens' digital assets.
In this age of technology, there is a reason to be concerned about the threats posed by cybercrooks to individuals and organizations. The risk of using digital means for communication, e-commerce, and critical infrastructure has increased significantly. It is important to have proper measures in place to prevent cybercrime and destructive behavior. The Department of Telecommunication has unveiled "Chakshu," a digital intelligence portal aimed at combating cybercrimes. This platform seeks to enhance the country's cyber defense capabilities by providing enforcement agencies with effective tools and actionable intelligence for countering cybercrimes, including financial frauds.
Digital Intelligence Platform (DIP)
Digital Intelligence Platform (DIP) developed by the Department of Telecommunications is a secure and integrated platform for real-time intelligence sharing, information exchange and coordination among the stakeholders i.e. Telecom Service Providers(TSPs), law enforcement agencies (LEAs), banks and financial institutions(FIs), social media platforms, identity document issuing authorities etc. The portal also contains information regarding the cases detected as misuse of telecom resources. The shared information could be useful to the stakeholders in their respective domains. It also works as a backend repository for the citizen-initiated requests on the Sanchar Saathi portal for action by the stakeholders. The DIP is accessible to the stakeholders through secure connectivity, and the relevant information is shared based on their respective roles. However, the platform is not accessible to citizens.
What is Chakshu?
Chakshu, which means “eye” in Hindi, is a new feature on the Sanchar Saathi portal. This citizen-friendly platform allows you to report suspicious communication you receive via calls, SMS, or WhatsApp. “Chakshu” is a new advanced tool to safeguard against modern-day cybercriminal activities. Chakshu is a sophisticated design that uses the latest technologies for assembling and analyzing digital information and provides law enforcement agencies with useful data on what should be done next. Below are some of its attributes.
Here are some examples of what you can report:
- Fraudulent messages claiming your KYC (Know Your Customer)details need to be updated.
- Fraudulent requests to update your bank account, payment wallet, or SIM card details.
- Phishing attempts impersonating government officials or relatives asking for money.
- Fraudulent threats of disconnection of your sim connections.
How Chakshu Aims to crackdown Cybercrime and Financial Frauds
Chakshu is a new tool on the Sanchar Saathi platform that invites individuals to report suspected fraudulent communications received by phone, SMS, or WhatsApp. These fraudulent activities may include attempts to deceive individuals through schemes such as KYC expiry or update requests for bank accounts, payment wallets, SIM cards, gas connections, and electricity connections, sextortion, impersonation of government officials or relatives for financial gain, or false claims of mobile number disconnection by the Department of Telecommunications.
The tool is well-designed and equipped to help the investigators with actionable intelligence and insights, enabling LEAs to conduct targeted investigations on financial frauds and cyber-crimes; the tool helps in gathering a comprehensive data analysis and evidence collection capability by mapping out the connection between individuals, organizations and illicit activities, it, therefore, allows the law enforcement agencies in dismantling criminal activities and help the law enforcement agencies.
Chakshu’s Impact
India has launched Chakshu, a digital intelligence tool that strengthens the country's cybersecurity policy. Chakshu employs modern technology and real-time data analysis to enhance India's cyber defenses. Law enforcement can detect and neutralize possible threats by taking proactive approach to threat analysis and prevention before they become significant crises. Chakshu also improves the resilience of critical infrastructure and digital ecosystems, safeguarding them against cyber-attacks. Overall, Chakshu plays an important role in India's cybersecurity posture and the protection of national interests in the digital era.
Where can Chaksu be accessed?
Chakshu can be accessed through the government's Sanchar Saathi web portal:https://sancharsaathi.gov.in
Conclusion
The launch of the Digital Intelligence Platform and Chakshu facility is a step forward in safeguarding citizens from cybercrimes and financial fraud. These initiatives use advanced technology and stakeholder collaboration to empower law enforcement agencies. The Department of Telecommunications' proactive approach demonstrates the government's commitment to cybersecurity defenses and protecting digital assets, ensuring a safer digital environment for citizens and critical infrastructure.
References
- https://telecom.economictimes.indiatimes.com/news/policy/dot-launches-digital-intelligence-portal-chakshu-facility-to-curb-cybercrimes-financial-frauds/108220814
- https://bankingfrontiers.com/digital-intelligence-platform-launched-to-curb-cybercrime-financial-fraud/
- https://www.business-standard.com/india-news/calcutta-hc-justice-abhijit-gangopadhyay-sends-his-resignation-to-prez-cji-124030500367_1.html
- https://www.the420.in/dip-chakshu-government-launches-powerful-weapons-against-cybercrime/
- https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2011383
