Cybersecurity Insurance Is Changing

Here’s What Your Business Needs to Know

Cybersecurity insurance has evolved dramatically in recent years. What used to be a relatively low-cost, low-scrutiny policy is now a complex and highly conditional safety net. Today, insurers are digging deeper, expecting more, and paying out less—especially after an incident.

Whether you're shopping for your first policy or reviewing existing coverage, here’s what every business owner should understand about how cyber insurance works before and after an attack.

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After an Attack: The Claims Process Is No Longer Simple

Filing a claim doesn’t mean receiving a check. In most cases, you’ll go through:

  1. Forensic Investigation – Your systems and logs are audited to determine if negligence played a role.

  2. Compliance Review – Carriers check whether you upheld your side of the policy (MFA in place, backups tested, etc.).

  3. Legal Filtering – Insurers may cite exclusions for phishing, negligence, or third-party risk.

  4. Delayed or Reduced Payouts – If gaps are found, payouts may be lowered—or denied altogether.

Claim denials are rising, especially when security controls were only "checked on paper."

41% of cyber insurance claims are denied or disputed due to unfulfilled security controls.

Source: Coalition 2025 Claims Report

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The average time to receive payment after a breach now exceeds 75 days.

Source: NetDiligence Cyber Claims Study

Carriers have reduced coverage limits by 30–40% for SMBs in the past two years.

Source: Marsh Cyber Market Trends 2025

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How Tier 5 Helps

Tier 5 works with businesses before a policy is signed or a breach occurs, so you're ready when it matters most. Our services include:

  • Policy Readiness Reviews – Align your controls to insurer expectations.

  • IR Tabletop Exercises – Validate your team’s response plan for real-world scenarios.

  • Security Documentation & Policy Writing – Ensure you can demonstrate readiness and diligence.

  • vCISO Support – Represent your security leadership during underwriting or a post-incident review.

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