Cyber Insurance - What it covers and why it matters

Cyber Insurance – What it covers and why it matters

Caleb Meriwether, Producer & Principal @ Haven Insurance Partners, visits with Dan Reaves, host of ‘The Dan Reaves Show,’ today, and each Wednesday at 3:30 p.m., to discuss all things insurance.

Cyberattacks are no longer limited to large corporations. Families, small businesses, and even individuals are frequent targets of hackers, scammers, and ransomware. A cyber insurance policy can help absorb the financial and legal fallout — but not all policies are the same.

Personal Cyber Coverage

Personal cyber insurance is designed for individuals and families. It typically covers online fraud or theft, identity restoration after a breach, data recovery if files are lost or corrupted, and even cyberbullying or reputational harm.

Common exclusions include business-related losses, voluntary payments made to scammers, and older breaches that occurred before the policy began.

When reviewing your coverage, make sure it includes protection for ransomware, social engineering scams (where you’re tricked into transferring funds), and legal or PR support to repair your online reputation.

Commercial Cyber Coverage

For businesses, cyber policies generally include two main parts:

First-Party Coverage protects your company’s own losses from a cyberattack — such as forensic investigations, system restoration, lost income, ransomware demands, and PR costs.
Third-Party Coverage protects you from lawsuits, regulatory fines, and liability if customer or employee data is exposed.

Typical exclusions include acts of war, intentional employee misconduct, or voluntary wire transfers that aren’t covered under a social engineering endorsement.

When shopping or renewing, look for key features like business interruption coverage, contingent business interruption (for vendor or cloud outages), system failure coverage, and strong limits for ransomware and data restoration.

The Takeaway

Cyber coverage is one of the fastest-growing areas of insurance — and for good reason. Whether you’re protecting your family or your company, the right policy can mean the difference between recovery and ruin after a breach.