What Is Cyber Security Insurance?
Cyber security insurance, also known as cyber liability insurance, protects businesses against financial losses, legal liabilities, and reputational damage caused by cyber attacks, data breaches, and online fraud.
As cyber threats increase, businesses of all sizes—from small startups to large corporations—need cyber security insurance to protect sensitive data, avoid financial ruin, and comply with regulatory requirements.
Why Do Businesses Need Cyber Security Insurance?
- Cybercrime is on the rise – Businesses face growing threats from ransomware, phishing, and hacking.
- Regulatory compliance – Companies handling personal data must comply with GDPR, FCA, and other data protection laws.
- Financial protection – Cyber attacks can cause business downtime, lost revenue, and legal expenses.
- Reputation management – Data breaches can damage brand trust and lead to compensation claims.
What Does Cyber Security Insurance Cover?
1. First-Party Coverage – Protects your business directly
- Data breach response – Covers forensic investigations, legal fees, and customer notifications.
- Cyber extortion & ransomware – Pays for ransom demands and system recovery.
- Business interruption – Covers lost revenue if a cyber attack disrupts operations.
- Data & system restoration – Helps recover lost or stolen data and repair affected systems.
2. Third-Party Coverage – Protects against claims from customers and regulators
- Legal defence costs – Covers lawsuits from clients or regulatory fines due to a data breach.
- Customer compensation – Pays damages if customer data is stolen.
- GDPR fines & compliance – Helps businesses comply with data protection laws.
Industries That Need Cyber Security Insurance
- E-commerce & online businesses – Handling online payments and customer data.
- Financial services & FinTech – Protecting transactions and sensitive banking data.
- Healthcare & legal firms – Securing patient records and confidential documents.
- Tech startups & SaaS providers – Ensuring protection for software, cloud services, and user data.
How Much Does Cyber Security Insurance Cost?
The cost of cyber security insurance depends on:
- Business size & industry risk – Financial and healthcare firms face higher risks.
- Amount of sensitive data stored – More data = higher potential liability.
- Level of security measures in place – Companies with strong cybersecurity may get lower premiums.
Estimated Costs
- Small business (1-10 employees): £300 – £1,500 per year
- Mid-sized business (50-250 employees): £2,000 – £10,000 per year
- Large corporation (250+ employees): £10,000+ per year
Best Cyber Security Insurance Providers in the UK
- Hiscox – Specialises in cyber risk insurance for SMEs and corporate businesses.
- Chubb – Offers cyber liability coverage for ransomware, data loss, and compliance risks.
- AIG – Provides tailored cyber security insurance for financial services and technology companies.
- CFC Underwriting – A leading cyber insurance provider for digital businesses.
How Fraser Bond Can Help
Fraser Bond works with leading insurers to help businesses:
- Find the best cyber security insurance policy for their needs.
- Compare policies to secure competitive rates.
- Ensure compliance with GDPR and data protection laws.
- Manage cyber risk assessments to prevent potential attacks.
Final Thoughts
Cyber attacks are a growing threat to businesses of all sizes. Investing in cyber security insurance provides essential protection against financial losses, legal claims, and reputational damage caused by cybercrime.
For expert guidance on securing the right cyber liability policy, contact Fraser Bond today.
