UPSC Prelims 2020 Q60: Science & Technology – Computer & Information Technology

UPSC Prelims 2020, General Studies Paper I · Science & Technology

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:

(a) 1, 2 and 4 only
(b) 1, 3 and 4 only
(c) 2 and 3 only
(d) 1, 2, 3 and 4

Answer: (b) 1, 3 and 4 only

Explanation

Cyber Insurance for Individuals: Coverage Details

Benefit	Generally covered?
1. System restoration from malware	YES
2. Computer replacement if wilfully damaged	PARTIAL - if theft, not willful damage
3. Specialized consultant for cyber extortion	YES
4. Defence in court for third-party suit	YES

Cyber insurance for individuals typically covers:

- Loss of funds (direct)

- Malware removal + system restoration

- Crisis management (extortion negotiation)

- Legal defence (third-party liability)

- Identity theft recovery

- Cyber extortion costs

Wilful damage by miscreant may not be covered (requires intentional act of third party against specific individual, usually excluded).

Answer: (b) 1, 3 and 4 only - Excludes statement 2 (wilful damage may not be standard coverage).

Why each option is right or wrong

(a) Incorrect. Incomplete - statements 3 and 4 also covered.
(b) CORRECT. Statements 1 (malware restoration), 3 (extortion consultant), 4 (court defence) are standard. Statement 2 (wilful damage) may be excluded.
(c) Incorrect. Incomplete - statements 1 and 4 also covered.
(d) Incorrect. Statement 2 (wilful damage to computer) may not be standard coverage.

Key point

Cyber insurance coverage: Direct loss (funds), Malware/ransomware (restoration), Extortion (crisis management), Liability (legal), Identity theft. Exclusions: Gross negligence, criminal acts.

Remember

Cyber insurance for individuals generally covers: (1) Cost of restoring computer system after malware (correct), (3) Cost of specialized consultant for cyber extortion (correct), (4) Cost of legal defence if third party files suit (correct). However, statement 2 (wilful damage by miscreant) may NOT be standard coverage.

Common mistakes

Assuming all damage types covered. Wilful acts of criminals are often excluded or limited.
Confusing cyber insurance with general property insurance. Cyber policies are specialized.
Missing that coverage varies by insurer and policy tier (basic vs comprehensive).

Exam tip

Cyber insurance in India: Growing market post-2020. Policies from ICICI, HDFC, etc. Covers personal + SME levels. Critical for digital payment users, e-commerce shoppers.

Sources

Insurance Regulatory and Development Authority (IRDA) - Cyber Insurance Guidelines
Indian Insurance Institute - Cyber Risk Management

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