Cyber Insurance Cost

Cyber insurance can provide valuable protection against cyber attacks and data breaches. However, like any insurance policy, it comes at a cost. Here are some benefits of cyber insurance and factors to consider when deciding if it’s worth the investment.

Factors That Affect the Cost of Cyber Insurance

Business size and revenue: Larger businesses with higher revenue may require more coverage and could face higher premiums.

Industry and risk profile: Businesses in high-risk industries, such as healthcare and finance, may require more coverage and could face higher premiums.

Cybersecurity posture: Businesses with stronger cybersecurity measures in place may be able to negotiate lower premiums.

Deductibles: Given the amount of deductible a business pays, the overall premium cost can be reduced accordingly

How much does Cyber insurance Cost?

Typically, cyber insurance is an add-on to your existing homeowners or business insurance policies. On average, for a personal cyber insurance policy of $25,000 coverage individuals can expect to pay $25 to $100 a month.

According to Insureon, small businesses tend to pay anywhere from $1,000 to $2,000 per year. The higher end of this amount can increase depending on the business and its needs.

Why is Cyber Insurance So Expensive?

Cyber insurance can be more expensive than other types of insurance due to the increasing frequency and severity of cyber attacks and data breaches.

The cost of cyber incidents can include business interruption, legal fees, regulatory fines, and reputational damage. Cyber incidents can also be more expensive than other types of insurance claims due to the complexity of data recovery and the potential for multiple parties to be affected.

How Much Does the Average Cyber Claim Cost?

The cost of a cyber claim can vary widely depending on the type and severity of the incident. According to a report by IBM, a data breach in the US costs around $9.44 million, which is double that of the global average of $4.35 million.

The report also indicates that the average data breach costs in the health sector is about $10.1 million. This is an increase of 42% in comparison to 2020. Cases of phishing, business email compromise, third party software vulnerability each cost $4.91M, $4.89M, and $4.55M respectively.

Such high numbers are enough warnings for businesses to tighten their security and have a proper insurance backup in place.

Tips to Reduce Cyber Insurance Cost

Conduct a risk assessment: A thorough risk assessment can help businesses understand their vulnerabilities and identify the level of coverage they need.

Consider partnering with a broker: Insurance brokers can help businesses navigate the complex landscape of cyber insurance and negotiate better pricing.

Implement Strong Cybersecurity Measures: Investing in strong cybersecurity measures such as firewalls, intrusion detection systems, and employee training can reduce the risk of cyber attacks and lower Cyber Insurance premiums.

Assess Cyber Risk Exposure: Conducting a thorough assessment of a business’s cyber risk exposure can help identify areas where additional security measures are needed and potentially reduce Cyber Insurance premiums.

Choose the Right Level of Coverage: Choosing the right level of coverage for a business’s needs can help avoid unnecessary expenses and reduce Cyber Insurance premiums.

Shop Around: Comparing Cyber Insurance policies and premiums from different providers can help businesses find the best coverage at the most competitive price.

By taking these steps, businesses can manage their Cyber Insurance costs while still ensuring they have adequate protection against cyber risks.