CRA Insurance Explored – South Africa
Our growing reliance on internet connectivity means that protection against cyber-crime is an increasingly important consideration in personal financial planning
As eCommerce and reliance on digital banking and transactional platforms grows, so too have the risks for fraudulent payment scams and cyber-crime. Cyber-attacks now cost the world more than natural disasters, while malicious hackers attack computers and networks at a rate of one attack every 39 seconds, according to a report from Accenture¹.
Cyber-crime can affect anyone who transacts online, while the pandemic has amplified the risks by opening the door to greater opportunistic threats. Phishing scams, virus attacks, fraudulent online and in-app purchases and EFTs, social engineering and identity theft affect millions of businesses and individuals every year.
“While the need for cyber insurance is more readily understood and taken up in a commercial environment, individuals often believe that it won’t happen to them because hackers don’t consider smaller targets worth the effort. Statistics clearly show that this is not the case, and many consumers simply overlook the importance of protecting their online and personal identity through an insurance and risk management approach, in the same way that businesses do,” explains Carl Moodley, Chief Underwriting and Claims Officer of GENRIC Insurance Company.
“Given our reliance on internet connectivity for virtually every aspect of our lives – from transacting, payments, communicating, entertainment and more – the need for insurance protection for cyber-risks is becoming an essential personal financial planning tool in much the same way as household, motor and contents insurance is for physical risks,” adds Moodley.
Cyber-crime affects individuals in various ways:
- Anyone who transacts online can be affected by cyber-crime.
- Personal credit card and banking details can be stolen off computers, websites, mobile devices and apps and used fraudulently. Credit card details used to pay for mobile applications are vulnerable.
- Fraudulent online purchases can be made when neither you nor your credit card are present at the point of sale.
- Fraudulent EFTs can be done when someone gains access to your banking details and transfers money from your accounts without your knowledge.
- Phishing scams can con you into providing your personal details and use it to perpetrate fraud.
- Viruses and Malware unwittingly downloaded on your computer or mobile devices can harvest your personal data.
- Your identity can be stolen to perpetrate fraudulent online transactions. The process to restore your credit record and reputation can be onerous and very costly in terms of time, inconvenience and even legal costs.
“Individuals are typically softer targets as they are unlikely to have the security measures deployed in a business environment – such as anti-virus and malware software, firewalls, encryption, password protection, threat monitoring and so on. While it is easy to understand the physical nature of a robbery at your property and the need for insurance if things do go wrong, the intangible nature of cyber-crime leaves people at a loss as to how they can be at risk, and what they need to do to protect themselves. It’s a worrying oversight given just how prevalent cyber-crime has become in South Africa where individuals are as much in the sights of cyber-criminals as businesses are,” adds Moodley.
According to Accenture, South Africa has the third-highest number of cyber-crime victims worldwide with approximately R2.2 billion a year lost to cyber-attacks. ‘Card-not-present’ (CNP) fraud on South African-issued credit cards remains the leading contributor to gross fraud losses in the country, accounting for 79.5% of all losses, while the country has seen an increase of more than 100% in mobile banking application fraud, according to the Accenture report.¹ During 2019, malware attacks increased by 22% or 577 attempted attacks per hour.¹
Individual cyber-protection is now a necessity as cyber-crime rapidly escalates
The pandemic has catapulted virtually every aspect of our personal and work lives into the cyber realm – from work, education, shopping, communication, entertainment and transacting. As a result, individuals face greater risks and the potential for actual financial losses due to online threats. These threats will grow exponentially as we lead more digitised and internet-dependent lives.
“It’s one of the key reasons why personal cyber-risk protection is becoming as important as home, vehicle and life insurance are in one’s personal financial planning portfolio. Risks are no longer limited to what can go wrong on the physical world. A product solution like GENRIC’s Mycybercare product was designed for this eventuality, and protects the policy holder from loss of funds as a result of fraudulent online and In-app purchases, virus attacks, fraudulent EFTs, virus attacks and phishing scams. The cover is designed as an affordable addition to one’s personal insurance portfolio, and allows you to structure the cover to protect multiple devices, as well as a defined sum-insured,” explains Moodley.
Beyond insurance protection alone, Mycybercare also provides focused mitigation and educational measures to help consumers become more cyber-savvy and proactive about protecting their online identity and activity across personal, family and work exposures.
The policy is structured to mitigate against cyber-crime in the first place by implementing suitable virus and malware protection, detecting malicious threat actors and monitoring the dark web for fraudulent usage of your personal, family or business digital assets such as your ID, email, credit card, mobile number, bank account, IP addresses and other variants.
“It also provides for cyber-bullying prevention in terms of IT, legal and psychological assistance, and insures for online loss of funds. The monitoring and protection is done in real-time and policyholders are notified of any alerts that require intervention to prevent being a victim of online crime. Cyber-security awareness training is also provided through a video training portal which shows consumers how the human link is often the weakest link in a cyber-attack, and how to prevent becoming a victim of online crime in the first place,” Moodley adds.
Premiums range from R40 per month (R350 per annum) for R10 000 cover to R70 per month (R730 per annum) for up to R100 000 in cover for financial loss. Premiums and benefits are subject to review.
Article Credit to Engineering News.