Cyber Insurance for Small Businesses: Is It Worth It?

Cyber threats aren’t just for big corporations anymore — small businesses are now prime targets. But many small business owners still ask:

“Do I really need cyber insurance? And can I afford it?”

Let’s unpack the value, cost, and how to get started.

Why Cyber Insurance Matters

Cyber insurance helps protect your business from the financial and legal fallout of:

• Ransomware attacks

• Data breaches and hacks

• Phishing scams

• Cyber extortion

• Business email compromise

• Lawsuits, penalties, and forensic recovery

According to the U.S. Small Business Administration, nearly 88% of small business owners feel vulnerable to a cyberattack — yet many lack any real plan to recover.

Even with strong security in place, no system is bulletproof. Cyber insurance acts as a safety net, helping you recover faster and with less out-of-pocket damage.

What Does Cyber Insurance Cover?

Coverage may include:

• Costs to notify affected customers

• Legal fees and settlements

• Data restoration and system repair

• Loss of income due to downtime

• Cyber extortion and ransom payments

• Reputation management services

How Much Does It Cost?

Cyber insurance is more affordable than many assume.

According to Insureon:

• The average cost is $145/month

• 38% of businesses pay less than $100/month

• Premiums vary based on:

  • Industry

  • Data sensitivity

  • Past incidents

  • Size of the company

Compare that with the average cost of a small business data breach — which ranges from $120,000 to $1.2 million, depending on scope and response.

Top 5 Cyber Insurance Providers for Small Businesses

If you’re considering coverage, talk to your insurance agent and ask them to get quotes from several insurance companies known to serve small businesses in Massachusetts. Some well-known names include:

1. Hiscox

2. The Hartford

3. Travelers

4. Chubb

5. Coalition

6. Insureon

What to Do Next (If You’re a Small Business Owner)

1. Assess Your Risk

• What sensitive data do you store?

• What software and systems do you rely on?

• Could your business survive 3–5 days of downtime?

2. Talk to an Insurance Agent

• Ask your current provider about cyber insurance

• If they don’t offer it, contact the providers listed above

• Request coverage details and exclusions

3. Pair Insurance with Prevention

• Insurance helps you recover from financial losses, not repel a cyberattack

• Maintain MFA, secure backups, software updates, and employee training

Our Final Thought

Cyber insurance isn’t just a line item — it’s a layer of resilience. And in a digital world, resilience is reputation.

If you store data, accept payments, use cloud services, or work with third parties — you’re a target. Cyber insurance doesn’t eliminate risk, but it helps you recover with confidence.

Want help understanding where cyber insurance fits into your overall cybersecurity plan?  Get in Touch with Us → or Explore Our Services →