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Cyber insurance cost
The cost of cyber liability insurance varies based on a number of factors about your business. Your premium is directly impacted by your policy limits, how much sensitive data your company handles, and more.
What is the average cost of cyber insurance?
Small businesses pay an average premium of $145 per month, or about $1,740 annually, for cyber insurance, also called cyber liability insurance or cybersecurity insurance.
Our figures are sourced from the median cost of policies purchased by Insureon customers from leading insurance companies. The median offers a better estimate of what your business is likely to pay because it excludes outlier high and low premiums.
Typical cybersecurity insurance costs for Insureon customers
While Insureon's small business customers pay an average of $145 monthly for a cyber insurance policy, 38% pay less than $100 per month and 33% pay between $100 and $200 per month.
The cost varies for small businesses depending on their risks and the coverage they choose.
Understanding cyber liability insurance cost factors
As with other types of insurance, your provider calculates your cyber insurance premium based on a number of factors, including:
- Your policy limits and deductible
- Cyber threats in your industry
- Type of cyber insurance purchased
- Amount of sensitive information handled
- Number of employees
- History of insurance claims
Chat with a licensed insurance agent if you're unsure which coverage options to choose.
How do policy limits and deductibles affect cyber insurance costs?
Businesses that face higher risks may choose to pay more for higher policy limits. Overall, the amount of cyber liability coverage your business needs depends on your industry, your type of business, and the type of customer data you handle.
Cyber liability insurance policies have two limits, which typically range from $1 million to $5 million:
- Per-occurrence limit. While the policy is active, the insurer will pay up to this amount to cover any single incident.
- Aggregate limit. During the lifetime of the policy (usually one year), this is the maximum the insurer will pay to cover claims.
The average deductible for a cyber liability policy is $2,500 for Insureon customers. A higher deductible results in a lower premium, but make sure it's an amount you can easily afford. If you can’t pay for it in a crisis, your insurance won’t activate to cover your claim.
How does your industry impact the cost of cyber liability insurance?
Your industry will undoubtedly impact the cost you can expect to pay for cyber liability insurance. Industries with higher risk typically result in higher premiums.
Cybersecurity companies, network security companies, IT consultants, and other businesses responsible for their clients' cybersecurity can expect to pay more for cyber insurance coverage. This is because the potential for financial losses and reputational damage resulting from cyber errors is much higher.
Non-tech industries should carry cyber insurance as well, especially if they use POS systems, keep electronic client records, or do digital transactions. Even if they aren't managing major tech projects, employees can still fall victim to costly social engineering and phishing attempts, which can compromise client data.
Cyber insurance is just one policy that small businesses must consider. Depending on the industry that you work in, such as construction or cannabis, you may be required by your state to carry other types of insurance, most often general liability insurance.
How the different types of cyber insurance impact cost
Different types of cyber insurance can impact the amount you'll pay for coverage.
Most businesses only need first-party cyber liability insurance, also called data breach insurance, to defend against cyber risks at their own business. The cost depends on how much customer information they handle, such as credit card numbers or Social Security numbers.
Tech companies and consultants usually need third-party cyber coverage, which pays for legal costs if a client blames their business for failing to prevent a cyber incident. They can often combine this policy with professional liability insurance in a policy bundle called technology errors and omissions insurance, or tech E&O.
Top industries we insure
To see insurance costs for businesses in your industry, visit our industry-specific cost analyses.
Don't see your industry? Don't worry. We insure most businesses.
Cyber liability coverage provides affordable, necessary protection for your small business
Many small businesses forgo insurance because they assume they’re at low risk for cybercrime. However, cybercriminals often target small businesses as they have fewer resources to protect themselves. In fact, 98% of cyber insurance claims come from small and medium businesses.
Here's how these costs can escalate at a small business:
- A hacker brings down the software that a company relies on for customer transactions. The company misses three business days of work while the software is unavailable. Cyber liability insurance can pay for the business interruption caused by the outage.
- A cybersecurity consultant is sued for failing to prevent a ransomware attack on a client. The consultant has to pay the cyber extortion demand required to recover the client's data, on top of legal defense costs.
- A data breach exposes the personal information of hundreds of customers at a small retail shop. The retailer has to pay for a credit monitoring service for all those customers for several years, as well as any costs associated with the state-required notification for each customer. They may also have to invest in a public relations campaign to help fix their reputation.
As you can see, cyber insurance is an important part of risk management for businesses of all sizes that handle sensitive information.
View video transcript.
WARNING! WARNING! WARNING! WARNING! WARNING!
Cyberattack! Cyberattack, oh yeah!! It's a cyberattack!
Don't worry, you have cyber liability insurance. Your small business is protected from cyberattacks and data breaches that can cost thousands of dollars.
Got it bad! Got it bad! Got it bad! Cyberattack!
What the heck, man? So, no encore? I'm gonna need a ride home. Can someone call my mom?
You can get all the coverage your business needs by following this link. Protection is peace of mind.
How can you save money on cyber liability insurance?
Cyber liability insurance costs vary based on several factors. In addition to choosing lower coverage limits, these tips can help keep costs down:
Bundle your insurance policies
Businesses can often save money by bundling policies purchased from the same insurance provider.
For example, tech companies often choose to buy technology errors and omissions insurance, also called tech E&O. This policy bundles errors and omissions insurance with cyber liability insurance to protect against lawsuits related to mistakes, including failure to prevent a data breach on a client's system.
Pay the annual premium upfront
You can usually choose to pay your cyber liability insurance premium in monthly or annual installments. While it’s tempting to go with monthly payments because they require less cash upfront, many insurance companies offer businesses a discount for paying the entire annual premium at once.
Manage your cyber liability risks
If your small business has no cyber liability claims history, you could save money on your premium. You can also save money by implementing security measures at your business. For example, you might:
- Routinely change your business’s account passwords
- Invest in secure equipment and software
- Teach employees to recognize and avoid malware and phishing attempts
- Implement multi-factor authentication for employees
Why do small business owners choose Insureon?
Insureon is the #1 independent agency for online delivery of small business insurance. Our licensed agents help business owners compare quotes from top-rated providers, buy policies, and manage coverage online.
By completing Insureon’s easy online application today, you can compare free quotes for cybersecurity insurance and other policies from top-rated U.S. insurance companies. Once you find the right policies for your small business, you can begin coverage in less than 24 hours and get a certificate of insurance for your small business.
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Learn more about business insurance costs
Insurance premiums vary based on the policies a business buys. See our small business insurance cost overview or explore costs for a specific type of insurance coverage.
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Why do cyber insurance claims cost so much?
There has never been a greater risk of cyberattacks against small businesses, and the costs have never been higher. Learn why cyber insurance claims are so expensive, and how cyber liability insurance can help protect your business.
Updated: September 23, 2024