Cyber Insurance News of 2025 and How To Protect Your Business
In today’s increasingly unpredictable digital world, cyberthreats are no longer a distant possibility; they pose a serious risk for businesses of all sizes and industries. The 2024 Crowdstrike outage disrupted operations for airlines, airports, banks, and healthcare systems. This unfortunate event served as a stark reminder of just how fragile our systems are.
Although the incident was not a malicious attack, it underscored the importance of cybersecurity and cyber insurance in protecting businesses and facilitating their quick recovery from such events. As cyber threats become more frequent and severe, particularly for government entities, manufacturing, and technology sectors, it is clear that no organization is immune to attacks.
Whether the motive for an attack is financial gain or power, the consequences can devastate a business’s reputation and financial stability. Cyber insurance has become a critical asset for helping companies recover and ensure they are not left to face the impact of an attack alone.
As threats evolve, cyber insurance companies are adjusting their underwriting guidelines. While experts predict potentially lower rates this year, it’s more important than ever to understand what cyber insurance can offer your business and how to keep everyone in your organization protected.
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Cybersecurity protocols and a firm cyber insurance policy will protect your business. Prepare your infrastructure to mitigate cyber threats and build a strong security posture.
Understanding cyber insurance
Cyber insurance provides businesses with protection when a data breach compromises sensitive information about employees or clients within the company’s infrastructure. While many businesses think their general insurance will cover the liabilities of a cyberattack, this is often not the case.
Cyber insurance covers the following:
- Legal fees and expenses
- Notify customers and clients when a data breach occurs.
- Restore the personal information of affected customers
- Recover compromised data
- Repair damaged systems
- And more!
Without cyber insurance, your company could experience substantial financial losses and suffer reputational damage after a cyber attack affecting your business and its customers.
What to look for in cybersecurity liability coverage
When seeking cybersecurity liability coverage for your business, it’s important to understand the risks that providers are now considering in their policies. As threats have grown more complex, breaches and damages are becoming increasingly common.
Additionally, there are extra layers of data privacy, regulations, and compliance standards that are changing how underwriters assess the risk of a business. Each business should be aware of current threats so that it can incorporate preparations for them into its cybersecurity strategy to demonstrate to insurers that it is a trustworthy business that won’t create insurance issues.
Ransomware threats
Over the past decade, we have witnessed a substantial rise in ransomware attacks. In fact, last year set a new record for ransomware payments, making it the highest-grossing year to date.
As we move into this year and prepare for the next, we have observed attackers targeting healthcare organizations, schools, government agencies, and other infrastructure-related entities. Hackers believe that victims in these sectors are more likely to pay the ransom quickly to minimize disruption time.
Artificial intelligence security risks
Though AI can be a useful tool in business, it has also introduced a plethora of new risks, the most notable being AI-created deepfake scams, when a hacker uses AI to create fabricated videos or audio content that mimics individuals for fraudulent purposes. As AI has advanced, these impersonations have become so realistic that it’s hard to distinguish between the AI-generated video or voice and the actual person.
Additionally, cybercriminals can use AI to create and disperse malware, bypass passwords, generate social engineering attacks, and analyze stolen data. As businesses strive to keep up with these new and evolving scams, so do cyber insurance providers. AI has reshaped the insurance underwriting process, with underwriters now thoroughly inspecting how a business develops or utilizes AI tools to ensure they implement the correct compliance controls and measures to mitigate these risks.
Supply chain vulnerabilities
Vendors and suppliers typically maintain a weaker security posture than other targeted organizations, which makes it easier for attackers to breach their systems. Supply chain exposure can stem from various parties or practices within the organization and has become increasingly challenging for insurance providers to manage due to their lack of visibility and the complexity of addressing risk across multiple organizations.
A few ways supply chain attacks can occur:
- Third-party services or vendors have access to information
- Poor security practices by suppliers
- Compromised organizational software or hardware
- Software security vulnerabilities in supply chain management
- Inadequate third-party data storage measures
Due to their indirect nature, many hackers can evade these attacks. 54% of enterprise-level organizations report that supply chain vulnerabilities are the leading barrier to their cybersecurity.
Data collection concerns
Techniques like biometrics, pixels, and other tracking technologies have gained popularity among businesses for gathering personal data from stakeholders. This has been particularly prevalent for HR, advertising, and marketing processes. Unfortunately, this can lead to various privacy concerns.
First, businesses that use these tools need to ensure they comply with international, federal, and state legislation when collecting, processing, and storing this sensitive information. If they fail to do so, they could face substantial fines, penalties, and costly lawsuits related to cyber losses.
This year, in particular, businesses should be aware of the extensive regulatory scrutiny and changing privacy laws surrounding data collection. As more states and countries strengthen their data privacy frameworks, it is essential to stay updated on these changes.
Cyber insurance providers are also considering these changes. When evaluating a business, they assess how it manages personal data and whether that business complies with rules and best practices. Inadequate data governance or the use of risky tracking technology without proper safeguards can result in higher premiums, coverage exclusions, or even denial of coverage.
Regulated Security Services
Cybersecurity protocols and a firm cyber insurance policy will protect your business. Prepare your infrastructure to mitigate cyber threats and build a strong security posture.
4 tips on cyber insurance best practices
In addition to being covered by cyber insurance, it’s crucial that your business implements measures to support cybersecurity and avoid costly penalties. Adhering to best practices will not only bolster your security posture but also improve your insurance eligibility and pricing.
These four tips will assist your business in aligning its internal security practices with insurance providers’ expectations and guidelines.
- Implement comprehensive employee training programs to keep your team informed about the latest cyber threats, such as AI, and how to detect and mitigate these risks.
- Develop and establish a clear, documented cyber incident response plan to prevent potential downtime and minimize damage from a cyber attack or data breach. Ensure you test this plan regularly by running through scenarios with your staff and making adjustments as needed.
- Conduct regular and comprehensive risk assessments of third-party vendors before establishing a partnership with them. Review their cybersecurity practices and protocols, inquire about data protection, and ensure they meet your company’s standards for safeguarding sensitive data.
- Consult cybersecurity, cyber insurance, and legal professionals to determine the regulatory compliance standards your business must follow and make the necessary changes accordingly.
These best practices will demonstrate to insurers that your business takes cyber threats seriously, leading to better coverage and fewer disruptions. Prevention and preparation coincide; further enhance your organization’s security by finding the right cyber insurance provider and cybersecurity strategy for you.
Find your cyber insurance provider and enhance security
Awareness of the reputational and operational risks associated with cyber threats continues to grow, and businesses are recognizing the necessity of taking proactive cybersecurity measures – not only to mitigate risks but also to secure the best possible cyber insurance coverage. Insurance providers will be more willing to work with businesses that have cybersecurity protocols in place and have addressed any gaps in their security strategies.
Our team is here to help you establish a foundation that will secure a strong insurance policy for your business. Our experts will work with you to implement security best practices, offer ongoing support and maintenance, and steer you towards a cyber insurance policy that truly safeguards your organization.
Contact us today to discover our services and how we can assist you in finding the right insurance coverage for your business.
About Applied Tech
Applied Tech is a leading IT and cybersecurity services provider dedicated to helping businesses protect their digital assets. Our proactive and strategic services include cloud management, security, productivity, and IT growth strategy. With a team of experienced professionals, we provide unique solutions tailored to your IT needs.
Protect your business with Applied Tech’s fully managed IT services, co-managed support, and security assistance. With IT services focused on your business goals, keep your team productive and your data secure.
