Types of cyber insurance

Just one cyber incident can have a lasting negative impact—not only on businesses of all sizes but also on individuals. From financial losses and operational disruptions to stolen personal data and identity theft, the consequences can be severe and far-reaching.

Cyber insurance coverage helps protect against these threats, offering support for both organizations and individuals to recover from cyberattacks, data breaches, and fraud. Whether it's restoring business operations or reclaiming your digital identity, the right coverage can make all the difference.

Here’s a look at some common types of cyber insurance that address a wide range of cyber-related risks and exposures—for both corporate and personal protection.

Business interruption

A single cyber incident can disrupt more than just internal operations—it can interrupt the flow of goods, services, and trust between businesses and their customers. Whether it's a retailer unable to process transactions or a healthcare provider locked out of patient records, business interruption caused by a cyberattack can have a direct and immediate effect on consumers.

Cyber insurance can help cover the costs of downtime, lost revenue, and recovery efforts—allowing businesses to restore operations quickly and continue serving their customers. For individuals, this means fewer delays, better protection of personal data, and faster resolution when services are impacted.

Media liability

Cyber insurance coverage isn’t just limited to cyberattacks on systems and databases. Today, most businesses post and distribute information online via websites and social media platforms. This creates a different kind of cyber risk that requires its own specific protection.

Media liability insurance can be added to a cyber insurance policy to protect businesses from a range of risks, including claims of slander or libel, trademark or copyright infringement, and inappropriate use of someone’s likeness. Media liability insurance provides protection so businesses can feel secure in their online presence.

Breach response

Breach response insurance can cover costs associated with restoring faith among consumers, including public relations and crisis management services. Reputation protection also covers the cost of offering customers identity monitoring services, fielding their questions, and monitoring the news and social media.

Liability coverage

Liability coverage is another essential component of cyber insurance, offering protection for both businesses and the individuals they serve. During and after a cyberattack, organizations can face a wide range of liability risks—many of which directly impact consumers.

• Legal costs and privacy-related claims that arise from data breaches, including lawsuits from affected customers or clients.
• Regulatory fines and penalties imposed due to non-compliance with data protection laws.
• Credit monitoring and identity protection services for consumers whose personal information may have been compromised.
• Claims related to insufficient network security, which can affect both business operations and consumer trust.
• Contractual liability, covering losses if a business is unable to meet obligations—such as delivering services or protecting customer data—due to a cyber incident.

Liability coverage helps businesses manage the financial and reputational fallout of a cyberattack, while also ensuring that consumers receive the support and protection they need in the aftermath.

Related expenses are often covered too, including any regulatory fines related to the breach, and claims that a business’ network security was insufficient.

Cyberextortion and cybercrime

Cybercrime coverage protects businesses from financial losses caused by malicious cyberattacks—even when strong cybersecurity measures are in place. This coverage can include protection against tactics like social engineering, where attackers trick employees into sharing sensitive information or transferring funds. It can also cover invoice manipulation, where attackers intercept or alter payment instructions to redirect funds. Cybercrime coverage helps businesses recover from fraud-related incidents and strengthens their resilience against evolving digital threats.

Cyberextortion is a type of cybercrime where attackers demand payment—often through threats or actual disruption—to restore access to data or systems. One common example is a ransomware attack, where a business’s files or networks are encrypted and held hostage until a ransom is paid.

After a cyberextortion event, cyber extortion protection typically covers the cost of cybersecurity consultants and forensic investigations, legal fees, and funds for the business to use to pay a ransom.

Depending on the terms of the policy, coverage may extend to victim notification and data monitoring services.

Data restoration

During a cyberattack, critical data can be manipulated, stolen, or destroyed—impacting not only businesses but also the consumers who rely on their services. Data restoration insurance helps organizations recover quickly by covering the costs of investigating the incident, restoring lost data, and resuming normal operations.

• Investigation and recovery costs to determine the cause and extent of the attack.
• Restoration of data and software, helping businesses get back online and continue serving their customers.
• Recreation of lost data, either manually or from cloud backups, when original data cannot be recovered.

For consumers, this means faster access to services, better protection of their personal information, and reduced risk of long-term disruption or data loss.

Data restoration coverage plays a key role in minimizing downtime and maintaining trust—ensuring that both businesses and their customers can move forward with confidence after a cyber event.

Frequently asked questions

What is cyber coverage?

Cyber coverage is insurance designed to protect both businesses and individuals from the financial and operational fallout of a cyberattack. While it’s often associated with companies, cyber threats can affect anyone—making this coverage increasingly relevant for consumers as well. Depending on the policy, it can cover a wide range of risks, including business interruption, cybercrime, breach response, cyber extortion, identity theft, and the cost of restoring lost data. Whether you're running a business or managing your personal digital life, cyber coverage offers peace of mind and helps you recover quickly and confidently in today’s increasingly connected world.

What does cyber insurance not cover?

Cyber insurance provides broad coverage for a range of cyber-related incidents. However, it’s important to understand what is not covered under this type of specialized policy.

For example, it excludes cyber-related losses due to intentional or criminal acts by someone employed by the business.

Traditional property damage or loss are not covered by cyber insurance, either. Losses due to utility failure and natural disasters are typically excluded.

It’s important for businesses to carefully review their needs and policy language to ensure they understand which events their cyber insurance covers.

What is the difference between tech E&O and cyber coverage?

Both tech E&O (errors and omissions) and cyber coverage are essential for businesses that work with technology—but they serve different purposes and protect against different risks.

• Cyber insurance is designed to protect businesses (and in some cases, individuals) from losses related to a cyberattack. This includes data breaches, ransomware, business interruption, and liability for compromised consumer data. For consumers, this coverage helps ensure that businesses can respond quickly to incidents, protect personal information, and restore services with minimal disruption.
• Tech E&O insurance, on the other hand, protects technology professionals and service providers from claims of professional negligence. If a software developer, IT consultant, or tech firm makes an error that leads to a cyber event—such as a data breach or system failure—tech E&O helps cover the legal and financial consequences. This is especially important when a mistake causes harm to a client or their customers.

To summarize, cyber coverage focuses on the impact of cyberattacks, while tech E&O addresses the professional responsibility of those who build and manage technology. Together, they help protect both the providers and users of digital services.

What is the difference between D&O and cyber coverage?

Directors & officers (D&O) insurance and cyber liability insurance serve distinct purposes—but both are critical in managing the risks associated with cyber incidents.

D&O insurance: Protecting leadership

D&O insurance provides coverage for claims brought against a company’s directors and officers by third parties—such as shareholders, regulators, or customers.

In the context of a cyber event, D&O coverage may apply if executives are accused of mismanagement or failure to uphold their fiduciary duties. For example, if a ransomware attack leads to significant financial loss, shareholders might sue leadership for not implementing adequate cybersecurity measures.

However, D&O coverage is highly dependent on policy terms and exclusions, such as:

• Cyber or confidential information exclusions, which vary between public and private sectors
• Contractual or unlawful conduct exclusions, which may limit coverage for cyber-related claims
• Bodily injury or property damage (BIPD) exclusions, which could preclude coverage for privacy-related claims—often central in cyber litigation

Cyber liability insurance: Protecting the business and its customers

Cyber liability insurance provides first- and third-party coverage for losses directly tied to a cyber incident. Unlike D&O, this coverage is designed to help businesses respond to and recover from the attack itself.

For consumers, cyber liability coverage ensures that businesses can respond quickly and responsibly—offering timely notifications, identity protection services, and restored access to services.

How much cyber coverage do I need?

The amount of cyber coverage needed varies widely based on your unique risk profile—whether you're a business or an individual. For businesses, factors like company size, industry, data sensitivity, and reliance on digital systems all play a role. For individuals, the amount of personal data shared online, use of smart devices, and exposure to identity theft risks are key considerations.

Partnering with a specialized insurance professional is the best way to assess your specific needs and determine the right level of coverage. They can help you evaluate potential vulnerabilities and tailor a policy that fits your situation.

And don’t forget—cyber risks evolve quickly. Make a point to review your policy annually to ensure your coverage keeps pace with new threats and changes in your digital footprint.

Protect yourself with cyber insurance

With cyberattacks on the rise, it’s essential for both tech-dependent businesses and individuals to have the right coverage to protect against cyber-related losses. A cyber insurance policy is a critical part of any risk management strategy in today’s digital age—whether you're running a company or simply managing your personal digital footprint.

For businesses, cyber insurance helps safeguard operations, data, and brand reputation. For consumers, it can offer protection against identity theft, financial fraud, and the loss of access to essential services.

Having the right coverage can make all the difference—helping you recover from a cyber event quickly and confidently, rather than succumbing to its long-term consequences.