Cyber Insurance Trends and Statistics to Know in 2025

It used to be that cyber insurance was just another checkbox for businesses. Now? It’s a non-negotiable.

With ransomware payouts doubling in 2023 and cybercrime projected to cost the world $13.8 trillion by 2028, businesses can’t afford to be uninsured. But here’s the catch—insurers are making it harder than ever to get covered. They want proof that your company is serious about cybersecurity before they’ll write a policy. No multi-factor authentication (MFA)? No endpoint protection? No coverage.

So, what’s happening in the world of cyber insurance? Premiums are rising. AI-powered attacks are making policies more expensive. And companies are rethinking how they defend against cyber risks. We’ve gathered the latest stats, trends, and expert insights to help IT leaders stay ahead.

Let’s have a look.

Cyber Insurance Trends and Statistics – Editor’s Picks

Here are the biggest takeaways shaping the cyber insurance market in 2025.

• Cyber insurance is booming. The market hit $14B in 2023 and is set to double to $29B by 2027 (Munich Re). Yet, 87% of companies still lack coverage—a major risk.
• Ransomware claims are surging. Payouts doubled to $1.1B in 2023 (Chainalysis). Insurers now demand stronger security—or they won’t pay.
• AI is shaking up cyber insurance. Hackers use AI deepfakes and phishing to breach systems, while 50% of businesses leverage AI-driven security for better premiums (Delinea).
• Stricter requirements are here. 51% of businesses must have MFA just to qualify for coverage (Arctic Wolf). Weak security? Expect sky-high premiums or denial.
• Small businesses are easy targets. 80% of large firms have cyber insurance, but only 10% of SMBs do (Swiss Re). Hackers know—and they’re going after them.
• Cyberattacks cost more than ever. The average breach is now $4.45M—up 15% in three years (IBM). Without coverage, businesses foot the bill.

What Is Cyber Insurance?

Cyber threats are a business problem nowadays. And with cyberattacks skyrocketing, companies need a financial safety net. That’s where cyber insurance comes in.

It’s like car insurance—but instead of covering fender benders, it covers ransomware attacks, data breaches, and business disruptions caused by cybercriminals. With cybercrime damage expected to hit $13.8 trillion by 2028, having coverage is critical.

Definition and Popularity

Cyber insurance protects businesses from the financial fallout of cyber incidents. Whether it’s stolen data, system downtime, or regulatory fines, a policy can help cover the damage. And companies are catching on fast.

• 62% of organizations now have cyber insurance, while another 38% are actively considering it (Arctic Wolf).
• Cyber insurance policies are getting stricter—many insurers now require proof of security measures like MFA before offering coverage (JumpCloud).
• Ransomware attacks remain the top driver of claims and force insurers to increase premiums and tighten policy terms (JumpCloud).

But cyber insurance isn’t just about paying off ransomware demands. It’s about business continuity. Without it, a single breach could put a company out of business.

Still think your company is too small to be a target? Think again. Phishing attacks are on the rise, and hackers don’t care about company size—they care about weak security.

Types of Coverage

Not all cyber insurance policies are the same. There are two major types of coverage:

First-Party Coverage

This covers direct costs your company faces after an attack.

• Data recovery – Covers the costs of restoring lost or stolen data after a breach.
• Business interruption – If a cyberattack takes down your systems, this helps recover lost revenue.
• Forensics & incident response – Pays for cybersecurity experts to investigate the attack.
• Ransomware payments – Some policies cover ransom payments, but insurers increasingly advise against paying hackers.

Third-Party Coverage

This covers legal and regulatory costs if customer data is exposed.

• Lawsuits & legal fees – If customer data is leaked, lawsuits happen. This covers the legal defense.
• Regulatory fines – If your company violates data privacy laws, this helps pay fines.
• Customer notification & credit monitoring – Some policies cover the cost of informing customers and providing them with identity protection services.

Key Cyber Insurance Statistics in 2025

The cyber insurance market is booming, but not without growing pains. Premiums are up, claims are skyrocketing, and businesses can’t afford to be uninsured anymore. Here’s what the numbers say.

Adoption Rates

Cyber insurance isn’t a luxury anymore—it’s a necessity. With cyber threats getting more aggressive, companies of all sizes are signing up.

• 62% of businesses now carry cyber insurance, while another 38% are actively considering it (Arctic Wolf).
• Large enterprises lead the charge, but small- to medium-sized enterprises (SMEs) are catching up, driven by compliance requirements and board pressure.
• The healthcare and finance industries have the highest adoption rates, due to strict regulations and a higher risk of attacks.

Cyber insurance is about staying insurable. Companies without strong security measures are finding it harder (and more expensive) to get covered.

Premium Trends

The price of cyber insurance is climbing, and you can blame ransomware for that.

• Cyber insurance premiums jumped by 50% in 2023—but the increase is slowing down as insurers adjust to market realities (Aon).
• Businesses with MFA, endpoint detection, and SIEM are getting lower rates, while those without security controls are paying significantly more (JumpCloud).
• Expect prices to remain stable through 2025—but companies with weak security postures might still see hikes.

Claims Data

Cybercriminals are getting smarter, and insurance companies are paying out more than ever.

• Ransomware accounts for 41% of cyber insurance claims, making it the number one reason businesses file (Munich Re).
• Phishing attacks are the second biggest claim type, responsible for 36% of breaches (JumpCloud).
• Business Email Compromise (BEC) is growing, with attacks causing over $3 billion in losses globally from 2021-2023.

The takeaway? If you don’t have MFA, endpoint security, and phishing-resistant authentication, you’re simply a prime target. 

Regional Insights: Where Cyber Insurance Is Growing Fastest

Cyber insurance is growing everywhere, but some regions are adopting it faster than others.

• North America dominates the cyber insurance market, holding 70% of global premiums (Swiss Re).
• Europe follows with 19% of the market, driven by strict GDPR regulations and rising ransomware threats.
• APAC adoption is still low (8%), but rising as governments push cybersecurity initiatives.

One key trend? SMEs are the biggest untapped market. While 80% of large enterprises already have cyber insurance, only 10% of SMEs do. That’s a huge protection gap waiting to be filled.

Trends Driving the Cyber Insurance Market

Cyber insurance is about risk prevention. Insurers are raising the bar and demanding better cybersecurity before offering coverage.

Ransomware Dominance: The Biggest Cost Driver

Ransomware is still public enemy #1 in cyber insurance.

• Ransomware payouts hit $1.1 billion in 2023—double what it was in 2022 (Chainalysis).
• More than half of all ransomware victims pay up, even though experts advise against it.
• Cyber insurance won’t always cover ransom payments anymore—many insurers now refuse to pay attackers.

If your ransomware defenses aren’t solid, expect higher premiums—or denied coverage.

Underwriting Changes

Getting cyber insurance is harder than ever. Insurers are cracking down and rejecting applications from companies without basic cybersecurity protections.

• MFA is now a must-have—insurers won’t cover businesses without it (JumpCloud).
• Endpoint protection and SIEM are becoming standard requirements for coverage approval.
• Companies with weak security postures face higher premiums—or outright denials.

In short, now cyber insurance is about forcing companies to improve security before they even qualify.

Regulatory Influence

Government regulations are pushing businesses to get insured—and insurers are tightening policy terms.

• SEC cyber disclosure rules are making cyber insurance a board-level priority (Aon).
• GDPR fines are driving up demand in Europe—companies that don’t comply risk massive penalties.
• Cyber insurance is evolving to include regulatory risk management, helping companies stay compliant.

If you’re in a regulated industry (finance, healthcare, retail), cyber insurance isn’t optional anymore.

Rise of Industry-Specific Policies

Not all businesses face the same cyber risks. That’s why industry-specific policies are on the rise.

• Healthcare cyber insurance covers HIPAA violations and patient data breaches.
• Financial sector policies include coverage for fraudulent transactions and SEC compliance.
• Manufacturing cyber insurance protects against operational technology (OT) and supply chain attacks.

One-size-fits-all doesn’t work anymore—insurers are now offering customized policies to fit specific industry needs.

Partnerships Between Insurers and Cybersecurity Providers

Insurance companies are teaming up with cybersecurity firms to help businesses reduce risk.

Managed Security Service Providers (MSSPs) are partnering with insurers to offer cyber risk assessments and security improvements. Cyber insurance is becoming a risk management tool for businesses out there.

Companies that invest in strong security get better insurance deals—it’s that simple.

The Challenges of Cyber Insurance

Cyber insurance is a safety net—until it isn’t. With rising premiums, tricky exclusions, and an ever-changing threat landscape, many businesses are left wondering: is this coverage actually worth it? Here’s what’s making cyber insurance harder to navigate in 2025.

Exclusions and Limitations

Just because you have cyber insurance doesn’t mean it covers everything. Insurers are getting picky, and companies are learning the hard way that some major risks aren’t included.

• Acts of war and nation-state attacks—If a cyberattack is linked to a government-backed hacking group, many policies won’t cover it (Munich Re).
• Failure to meet security requirements—If you don’t have MFA, endpoint protection, or basic cybersecurity hygiene, your claim could be denied.
• Ransomware payments aren’t always covered anymore—Some insurers refuse to reimburse businesses for ransom payments to avoid fueling criminal networks.

Companies that don’t pay attention to exclusions might find out too late that they’re on their own when a cyber disaster strikes.

Rising Premium Costs

Cyber insurance is more expensive than ever.

• Cyber insurance premiums jumped by 50% in 2023 due to ransomware claims skyrocketing (Aon).
• Small businesses are struggling—Many can’t afford cyber insurance anymore as policies cost too much for their budgets.
• Businesses with weak security pay the most—Companies that don’t use MFA, endpoint protection, or employee training are getting hit with higher premiums.

The message from insurers is clear: if you don’t invest in cybersecurity, you’ll pay more for coverage—or you won’t get covered at all.

Evolving Threat Landscape

Cyber threats are evolving faster than insurers can track.

• AI-powered cyberattacks are making traditional security measures useless—Hackers are using AI to craft hyper-realistic phishing scams and automate ransomware attacks (JumpCloud).
• Ransomware gangs are getting more aggressive—They’re stealing data before encrypting it, making it impossible to ignore the breach even if backups exist.
• Zero-day exploits are surging—Hackers are targeting software vulnerabilities before patches exist, catching businesses off guard.

The result? Insurers are tightening policies, making businesses work harder to prove they’re taking cybersecurity seriously before they get coverage.

Confidence Gap: Do Businesses Trust Their Coverage?

Despite paying higher premiums, many companies aren’t sure if cyber insurance will actually protect them.

• 87% of executives believe their business is not adequately protected against cyber threats (Munich Re).
• 42% of businesses that filed claims had their premiums raised afterward, making them wonder if coverage is worth the cost.
• 34% of companies that filed claims saw coverage limits reduced, meaning they were actually worse off after using their policy.

Cyber insurance isn’t the bulletproof safety net it once was. Businesses need to understand their policies, improve their security posture, and be proactive to get the most out of their coverage.

How to Maximize the Value of Cyber Insurance

We must remember that cyber insurance isn’t a substitute for strong cybersecurity—it’s a backup plan. The businesses that get the most out of their policies are the ones that take security seriously. Here’s how to get better coverage, lower premiums, and keep your business protected.

Improve Your Cybersecurity Posture: Reduce Risk, Pay Less

The best way to lower cyber insurance costs? Make yourself a low-risk client.

• Use MFA and strong access controls—This is the #1 thing insurers look for before approving coverage.
• Deploy endpoint detection & response (EDR)—Having strong monitoring tools can make a huge difference in lowering premiums.
• Train your employees—Human error is the biggest security risk, so regular phishing and security awareness training is a must.

Many insurers offer discounts for businesses that prove they have strong cybersecurity—so investing in security pays for itself.

Understand Policy Terms

A cyber insurance policy is useless if it doesn’t cover what you need.

• Check for exclusions—Make sure your policy doesn’t exclude common threats like ransomware or state-sponsored attacks.
• Know your coverage limits—Some policies cap payouts, leaving businesses underinsured when a major breach happens.
• Understand claim requirements—Some policies only pay out if you follow specific security protocols, like using MFA or patching software regularly.

Insurance isn’t a set-it-and-forget-it deal—stay on top of policy changes to make sure you’re always covered.

Perform Regular Risk Assessments

Don’t wait for a breach to find out your security is weak.

• Get a third-party risk assessment—Insurers trust independent security audits, and they might lower your premiums if you pass.
• Identify weak spots before they become problems—Fixing vulnerabilities early can prevent major breaches and expensive claims.
• Stay compliant with security regulations—Following frameworks like NIST, ISO 27001, or GDPR makes insurers more confident in your security.

Risk assessments help businesses prove they’re taking security seriously and this makes them more attractive to insurers.

Leverage Insurance Provider Partnerships

Many cyber insurance providers offer free security tools and risk management services—use them!

• Some insurers offer pre-breach support, including security monitoring and vulnerability scanning.
• Post-breach response services can help businesses recover faster after an incident.
• Working with an insurer’s cybersecurity partners can provide discounts on security tools.

If you’re paying for insurance, make sure you’re using all the benefits that come with it.

Final Thoughts: Cyber Insurance Alone Won’t Save You

Cyber insurance is a safety net, not a security strategy. The businesses that get the best coverage, lowest premiums, and fastest payouts are the ones that invest in security first. You must implement strong security controls like MFA, endpoint detection, and patch management and understand your policy inside and out.

Worth noting is that you must work with your insurer to strengthen your security, reduce risk, and maximize your policy’s value. Looking for an all-in-one security solution to help lower your cyber insurance costs? Try JumpCloud for free today and build a stronger security foundation for your business.