How to Get the Most Out of Your Cyber Insurance

by Zachary Barlow

January 23, 2025

A cyber attack can present organizations with many challenges including loss of consumer confidence and disruption to daily operations. Losses can mount quickly and the costs incurred by incident response vendors can impose further financial burdens. Many firms have begun offering cyber insurance to help companies protect against these losses. Some have voiced concerns and frustrations with their cyber policies. However, data from the NetDiligence 2024 Cyber Claims Study shows that policies are paying out, with $4 billion in claims paid over the past four years. Woodruff Sawyer recently published a blog with tips on how to get the best value from your cyber insurance stating:

“One way to ensure that your cyber events will be covered is to remember that coverage matters. Think about some common terms in a cyber policy and whether you understand the breadth of coverage against your company’s unique risks:

  • Does the definition of Confidential Data include all the data points your organization collects and stores? Do you carry data beyond the “traditional” legal definition of personally identifiable information (PII) like GPS data, device interactive data, cookies, and biometric data?
  • Does your policy’s definition of Insured Computer System include all the components within your enterprise, like operational technology, building management systems, and cloud environments?

If the answer to these questions is ‘no’—or worse, ‘I don’t know’—you need to consider whether your current cyber insurance policy is built for you or if it’s an “off the shelf” and commoditized product. Having a customized product is the best way to ensure you’ll be covered for any claims you file.”

The blog also encourages companies to identify incident response vendors and work with policy underwriters to ensure that selected vendors are covered. Being proactive in your cyber insurance from the policy drafting stage is critical to getting a tailored policy that pays out when you need it the most. When done right cyber insurance can provide peace of mind and valuable support in a time of crisis.