Cyber insurance cost

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.

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.

As with other types of insurance, your provider calculates your cyber insurance premium based on a number of factors, including:

• Policy limits and deductible
• Types of coverage
• Amount of sensitive data handled
• Number of employees
• Claims history
• Cybersecurity risk management
• Industry risks
• Remote work security risk

Chat with a licensed insurance agent if you're unsure which coverage options to choose.

Different types of cyber insurance can impact the amount you'll pay for coverage.

Most businesses only need first-party cyber 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.

The more sensitive data your business handles, the higher your chances of vulnerabilities that can lead to a data breach or other security incident.

Insurance company underwriters will often determine higher rates for companies with more opportunities for data incidents, especially data that involves personally identifiable information (PII), credit card information, and healthcare records.

For example, a large healthcare facility with many employees and patients will pay more for cyber insurance than a small medical office with only a few staff and far fewer patients.

The number of staff you employ can impact your cyber insurance rates. This is due in part to the increased chance of security failure and breaches of cybersecurity measures when there are more employees with access to sensitive information.

Employee training to prevent cyber incidents should be mandatory for all of your workers who have access to private data, banking details, and other sensitive information.

A lack of previous claims can help policyholders keep their insurance costs as low as possible.

A history of claims can signal a risk to insurance companies. Keeping your claims to a minimum can prevent future price hikes.

For example, a consulting business has a security breach due to a phishing scam and they make a claim to help with incident response and ransom payments. When their policy year ends, they notice the following year's cyber insurance is higher.

This increase is due, likely in part, to their claims history and having a claim filed on their insurance record.

Your business's risk management strategies will likely directly impact your insurance rates. The more education, training, and safety measures you implement, the less likely your business is to experience a security breach and the lower your rates will be.

Having the right firewalls, multi-factor authentication, and digital security measures in place can help your employees avoid inadvertent data breaches.

Keep costs low by adequately protecting your business and client information.

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.

For example, finance businesses pay an average $56 per month for cyber insurance, while IT businesses pay an average of $149 per month. This is due, in part, to the fact that the potential for financial losses and reputational damage resulting from cyber errors is higher for IT folks than it is for finance professionals.

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.

Below you can find the average cyber insurance costs for a variety of industries:

Cyber liability insurance costs vary based on several factors. In addition to choosing lower coverage limits, these tips can help keep costs down:

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.

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.

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

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.