Every business today is connected to the digital world, and with that connection comes risk. Cyber attacks are no longer rare or distant events. They are happening every single day to companies of all sizes. From a small retail store managing customer data to a global bank handling millions of transactions, no one is immune. This is why cyber insurance has become such an important part of modern business planning.

 

Why are businesses looking at cyber insurance?

 

Think of cyber insurance as a safety net. If an unexpected cyber incident occurs, insurance helps the organisation absorb the financial shock and recover faster. The costs of a cyber attack go beyond fixing a server or restoring data. There may be legal issues, regulatory penalties, reputational damage, and even the expense of hiring experts to investigate what went wrong. For many companies, especially smaller ones, these costs can be overwhelming.

 

Cyber insurance provides more than just financial cover. Many policies also give organisations access to specialists who can guide them during a crisis. This means legal advice, communication support, and even cybersecurity professionals who step in to help contain the damage.

 

How are policies changing?

 

The market for cyber insurance has changed quickly in the last few years. Since attacks are becoming more sophisticated, insurers are adjusting the way they design their policies. Premiums are rising, and coverage often depends on whether the organisation already has strong security practices in place. Companies that use multi-factor authentication, data encryption, and incident response plans are more likely to qualify for better coverage.

 

Another trend is the rise of specialised policies. Some focus mainly on ransomware and recovery, while others concentrate on regulatory compliance in industries such as healthcare and finance. This makes it more important for organisations to carefully study the details of a policy rather than choosing one simply based on price.

 

What to keep in mind before choosing a policy?

 

When exploring cyber insurance, organisations need to pay close attention to a few details.

 

a. Look at what is excluded from the policy. Some plans may not cover insider threats or attacks through third-party vendors.

b. Understand the kind of support offered when an incident happens. Quick access to experts is often more valuable than the insurance payout itself.

c. Check whether the policy covers regulatory penalties and compliance costs, especially as data protection laws are tightening worldwide.

d. Treat insurance as an additional layer of protection, not a replacement for strong cybersecurity practices.

 

The road ahead

 

The future of cyber insurance will likely move toward more personalised coverage. Insurers are already exploring real-time risk assessments and continuous monitoring to design policies that match the unique risk profile of each company. As new threats emerge, from supply chain disruptions to attacks powered by artificial intelligence, policies will evolve to address them.

 

For businesses, the key takeaway is that cyber insurance has shifted from being optional to being essential. It is a vital piece of the broader puzzle of digital resilience. The best approach is to see it as part of a larger strategy that also includes awareness, training, and strong technical defences.

 

If you would like to explore more perspectives and frameworks on managing cyber risks, the ISACA Mumbai Chapter is an excellent place to start. Engaging with industry professionals and thought leaders will help your organisation stay prepared for the future.

 

Related Read: Building a Career in Cybersecurity: Tips for Aspiring Professionals