With cyber attacks on the rise, it’s no surprise that more businesses are turning to cyber insurance. But as demand has grown, so too have cyber insurance costs. Premiums have surged, exclusions have widened, and underwriters are being far more selective. For small and medium-sized businesses in particular, the cost of cyber cover can feel like a burden, but that doesn’t mean it’s out of reach.
In this blog, we explore practical ways to reduce your cyber insurance costs while maintaining (and even improving) your cybersecurity posture. Spoiler alert: the key lies in being proactive, transparent and strategic.
Why Are Cyber Insurance Costs Increasing?
Before we look at ways to reduce costs, it’s worth understanding why they’re going up.
- Rising incidents: High-profile breaches, ransomware attacks, and phishing scams are becoming more frequent and sophisticated. Insurers are seeing more claims, and that’s driving premiums up.
- Stricter requirements: Insurers now demand robust cybersecurity controls in place before offering cover. If your business doesn’t meet the minimum standard, you may face higher premiums or be refused outright.
- Bigger payouts: When cyber attacks occur, the damage can be severe. Data recovery, business interruption, legal costs, and regulatory fines all add up, and insurers are factoring this into their pricing.
If you haven’t reviewed your policy in the past year, now is the time. Even small improvements to your security posture can reduce your cyber insurance costs.
1. Understand What’s Being Covered
Start by reviewing your existing policy in detail. Know exactly what’s covered, what’s excluded, and what your limits are. Many businesses pay for features they don’t need, while neglecting critical cover like business interruption or reputational damage.
Ask your broker for clarity, and ensure your policy is tailored to your business model, data types, and industry risk profile. A bespoke policy is often more cost-effective than a one-size-fits-all plan.
2. Demonstrate a Strong Cybersecurity Posture
One of the most effective ways to reduce your cyber insurance costs is to demonstrate that your business is a low-risk client. Insurers want to see evidence of:
- Up-to-date patching policies
- Antivirus and antimalware software
- Firewall and network segmentation
- Multi-factor authentication
- Regular staff training
- Incident response plans
Having these in place, and documented, not only strengthens your security but also makes you a more appealing customer to insurers.
For example, achieving certifications like Cyber Essentials or Cyber Essentials Plus can significantly reduce your premiums. They show underwriters that your business takes cybersecurity seriously.
3. Conduct a Penetration Test
Another excellent way to bring down your cyber insurance costs is to conduct a penetration test. A professional pen test identifies vulnerabilities in your systems before attackers do, allowing you to fix them proactively.
A recent, independently verified penetration test gives insurers confidence that you’re mitigating risk. It can also reveal compliance gaps that, once resolved, make your business eligible for better policies.
Explore our VIEW PENETRATION TESTING SERVICES to learn more about how this process works and what your business could gain from it.
4. Segment Your Data and Access Controls
One of the biggest risks in any breach is widespread access, when one compromised password leads to access across your whole organisation. To reduce that risk (and your cyber insurance costs), make sure your data is segmented, and access is controlled.
- Use role-based access to ensure employees only access what they need
- Encrypt sensitive data at rest and in transit
- Audit user permissions regularly
Insurers are much more likely to offer favourable terms to organisations that apply best practices in data handling and access control.
5. Update Your Business Continuity and Incident Response Plans
Having an out-of-date or non-existent response plan is a red flag to insurers. In contrast, a strong plan with designated roles, regular testing, and documented recovery procedures can lead to lower cyber insurance costs.
- Create a documented plan that includes steps to take during and after an attack
- Assign responsibility to specific team members
- Run simulations or tabletop exercises at least twice a year
Your incident response plan doesn’t just help you qualify for cover, it minimises downtime and financial impact if an attack occurs.
6. Work with a Trusted IT Support Provider
It’s no surprise that insurers feel more confident insuring a business that works with a professional IT support company. Managed IT providers like Marshall can help maintain strong security standards, manage documentation, and ensure regular patching and updates.
In some cases, insurers may even request a letter of assurance or documentation from your IT provider as part of the underwriting process. Being able to provide this not only speeds up the application but can also reduce your premium.
Cyber insurance costs may be rising, but they’re not out of your control. With the right cybersecurity measures in place, and a proactive mindset, you can reduce your risk profile, access better policies, and avoid overpaying.
If you’re unsure whether your current IT setup meets insurers’ expectations or need help preparing for a renewal, get in touch. Call us on 0203 384 9832, email enquiries@marshallinfotech.com or BOOK A MEETING to chat with our team today.
