The description is liek: "Also provides a 8% boost to your ship's defense
while it is under attack."

And I'm like, "Are you under attack when killin NPCs too?"
or
"Is it only under attack if another player chooses to attack you?"

Npc's can't attack you so yeah only when other players attack you.

"When under attack" means when another player is clicking the "Attack" button on your ship.