Not Just a Checklist Anymore: What Insurers Really Want to See in Your Cybersecurity
The cyber insurance landscape has changed dramatically. Gone are the days when getting coverage was a simple matter of filling out a basic questionnaire. Faced with soaring breach costs and ransomware payouts, insurers are now applying intense scrutiny during the underwriting process. They've shifted from passive acceptance to demanding tangible proof that you have robust security controls in place and are actively managing your risk.
Failure to meet these heightened standards has serious consequences: outright denial of coverage, sky-high premiums, reduced limits, or policies riddled with exclusions.
The "Table Stakes": Essential Controls for Coverage 🛡️
While specifics vary, insurers now consider a core set of security controls to be non-negotiable "table stakes" for obtaining meaningful coverage.
Multi-Factor Authentication (MFA): This is fundamental. Insurers are looking closely at how it's implemented, favoring stronger methods over basic SMS codes. Weak implementation is a major red flag.
Endpoint Detection and Response (EDR/MDR/XDR): Basic antivirus isn't enough. Insurers now mandate EDR or its more advanced forms for continuous monitoring, behavioral analysis, and automated threat response on all devices.
Email Security: Since email is a prime attack vector (phishing, BEC), robust protection like Secure Email Gateways (SEGs) is essential.
Secure and Tested Backups: Reliable, encrypted backups stored separately (offsite or air-gapped) are critical for ransomware recovery. Crucially, insurers demand proof these backups are regularly tested through recovery drills.
Vulnerability Management: Proactive scanning and prompt patching are required, often with tight deadlines for critical issues. Documented proof is key.
Identity and Access Management (IAM) / Privileged Access Management (PAM): Controlling user access, implementing least privilege, and securing administrative accounts are increasingly vital with the rise in credential theft.
Security Awareness Training: Regular employee training on phishing and social engineering is a cost-effective requirement, as human error is a major factor in breaches.
Incident Response Plan (IRP): A documented plan is necessary, but insurers increasingly want proof that it's tested via simulations or tabletop exercises.
The Hurdle for SMBs 🚧
Meeting these requirements can be particularly challenging for Small and Medium-sized Businesses (SMBs) due to several key hurdles:
Cost: Enterprise-grade security tools are expensive to buy, implement, and manage. SMB security budgets are often a fraction of those at larger companies.
Complexity & Expertise: These aren't "set-and-forget" tools. They require specialized skills to configure, manage, and monitor effectively. Many SMBs lack dedicated cybersecurity staff.
Skills Gap: A global shortage of cybersecurity talent hits SMBs hardest. They struggle to compete for limited experts due to budget constraints.
Awareness & Prioritization: Some SMB leaders may still underestimate their risk or lack awareness of the need for these controls. Security often takes a backseat to other business priorities.
The Bottom Line
Getting cyber insurance today requires demonstrating verifiable resilience, not just ticking boxes. While SMBs face significant hurdles in cost, complexity, and expertise, bridging this gap is crucial. In our final post, we'll discuss how an integrated strategy—combining the right technology, expert assessment, and specialized insurance guidance—can help.