From recovery to readiness – why traditional cyber insurance won’t save you

Many organizations view cyber insurance as a safeguard, assuming that if an attack occurs, financial compensation will cover the damage. But as cyber threats increase in frequency and severity, insurers are tightening their policies. Premiums are rising, coverage is shrinking, and claim approvals are no longer guaranteed.

Cyber insurance may help manage financial loss, but it does nothing to prevent business disruption, reputational damage, or operational downtime. A delayed or denied payout does not restore lost customers or reverse the long-term impact of a security failure.

When insurance isn’t enough

Companies often discover the limitations of cyber insurance at the worst possible time—after an attack. Coverage that once seemed comprehensive may exclude ransomware payments, operational downtime, or regulatory fines. Even valid claims can take months to process, leaving businesses struggling to stay afloat in the meantime.

Adding to this challenge, insurers now require proof of resilience before issuing or renewing policies. Meeting compliance standards alone is no longer sufficient. Organizations must demonstrate robust security measures, real-world incident response capabilities, and ongoing risk assessments to even qualify for coverage.

Cyber insurance vs. cyber resilience

Insurance is not a resilience strategy. While it may help recover financial losses, it does not restore operations, rebuild customer trust, or minimize the fallout of an attack.

Executives who rely on insurance as their primary cybersecurity safeguard are making a critical miscalculation. The real question is not whether a policy will cover an attack, but whether the organization is prepared to withstand one without needing a payout.

NIS2 is changing the game

Regulators are now forcing businesses to prove cyber resilience before an incident occurs. Under NIS2, organizations must implement risk-based security controls, conduct regular stress tests, and ensure that third-party risks are actively managed.

Insurers are following suit. Without a tested incident response plan, a strong security posture, and clear resilience measures, businesses may struggle to secure or renew coverage. And even those with policies in place may find that a slow or partial payout does little to mitigate the full impact of an attack.

Resilience first, insurance second

Cyber resilience starts long before an incident occurs. Businesses that regularly test crisis scenarios will be the ones that recover fastest when an attack happens. Strengthening response speed and preparedness reduces reliance on insurers and minimizes financial and reputational exposure.

Organizations must ask themselves a critical question: Are they betting on insurance—or actively building resilience? The companies that act now will be the ones that survive the next major attack, regardless of whether a payout arrives.

Is your business prepared or just insured?

How much of your cyber risk strategy depends on insurance? If an attack happened today, could you recover without relying on a payout—or would your business be left waiting?

The best protection is resilience, not financial compensation. Let’s discuss how to strengthen your security before the next major breach tests your strategy.