The Ministry of Science, ICT & Future Planning has signed a research agreement aimed at accelerating the growth of the domestic cyber insurance market which in its nascent stage is estimated at KRW30 billion (US$26.4 million).
The agreement was signed with the Consortium of Computer Emergency Response Team last week, reported Business Korea.
So far, only a handful of insurance companies such as AIG and Samsung Fire & Marine Insurance have released a small number of basic cyber insurance products to compensate for damages and losses attributable to hacking and so on.
Some players point out that businesses might pay less attention to their investment in security after taking out cyber insurance policies.
In this regard, the Ministry is planning to link insurers with information security service providers and provide incentives to policyholders. Discounts on insurance premiums for those participating in an information security management system are being mentioned although it is a matter to be determined by each insurance company.
At present, under the Use and Protection of Credit Information Act, financial institutions in South Korea are required to maintain liability insurance with regard to personal information leakage and the limits are KRW2 billion, KRW1 billion and KRW0.5 billion, depending on the sizes of the institutions.