Cyber insurance

Both businesses and private individuals are vulnerable to data breaches, phishing, ransomware, hacks and viruses. Cyber insurance does not protect against these risks, but it does protect against the consequences they cause. The number of cases of cybercrime has been rising for years, which is why cyber insurance is useful. What is cyber insurance? What does cyber insurance cost? These are just some of the questions answered here. This page describes the situation in the Netherlands.

What is cyber insurance?

Cyber insurance is insurance that offers protection against the costs resulting from cybercrime, but at the same time also covers liability towards third parties. In addition, cyber insurance often also provides expert support from IT specialists and lawyers, and it even covers reputational damage. It is a collective name for a range of insurance policies whose cover and exclusions often differ.

Cyber insurance is available for both private individuals and businesses. For businesses, the focus is more on matters such as reputational damage, loss of turnover, crisis management, cyber extortion and compensation for damage suffered by third parties. This cyber insurance is actually useful for every business, large or small. This is especially true for businesses in the medical sector, manufacturing, IT-related businesses, logistics companies, businesses in financial services and the wholesale and retail trade. Private cyber insurance is more about cyber extortion and the loss of money. Cyber insurance is often very useful for private individuals too.

Cover and exclusions of cyber insurance

Each insurer decides for itself what is and is not covered and excluded, and can also impose all kinds of restrictions itself. That is why it remains advisable to consult the policy conditions. Moreover, a tailor-made solution is desirable for business cyber insurance, while ready-made insurance contracts are a good solution for private individuals.

Private cyber insurance

Private cyber insurance is less about tailor-made solutions. It consists of packages put together on the basis of the risks that private individuals run. The cover often includes all family members living at home, but often also children who are studying and living away from home. However, age limits often apply to the latter, for example the students must be younger than 27. Moreover, private cyber insurance only covers damage suffered as a private individual.

Private cyber insurance covers, among other things, the consequences of identity fraud, cyber extortion, privacy breaches, loss of money from an account and reputational damage. The insurance pays for assistance, computer help, help with identity fraud, help with removing negative online posts, help with repairing reputational damage and defence costs. If money is lost from an account, compensation is awarded. In each case there is an excess and a maximum insured amount per event and per year. The excess and the maximum insured amounts in particular can differ greatly per insurer.

In addition, there are always exclusions. Here too, there are strong similarities between insurers. For example, cyber insurance usually does not pay out if the damage is caused by illegally obtained data (e.g. deliberately downloading illegal programs), if damage is caused intentionally or in the case of damage caused by (cyber)wars. Damage where appropriate security measures are missing is also usually excluded. In other words, you still need to arrange a good antivirus program and good security.

Business cyber insurance

Business cyber insurance always covers liability for damage in cyber incidents. This concerns not only liability claims from those affected, but also administrative fines from the Dutch Data Protection Authority (Autoriteit Persoonsgegevens, AP) and the costs and fines relating to electronic payment services. The costs of internal investigation and defence costs are usually covered too. Other forms of liability on the internet, for example a copyright infringement, are generally not covered by business cyber insurance.

A second component is your own damage, as is also insured with private cyber insurance. This concerns not only matters such as digital extortion, but also damage from cyber theft, phone hacking and the like. On top of that, it provides cover for business interruption losses, for example because a webshop is down for days and there is a loss of turnover. The costs can run very high, and that is why business cyber insurance is also much more expensive. In all these cases there are often restrictions, for example with regard to the number of days covered, or there are limits per event and per insurance year.

Finally, business cyber insurance provides cover for crisis management costs. These are the costs of support from lawyers, IT specialists, forensic specialists and communication professionals.

Either way, needs differ per business. A multinational gets little out of cyber insurance that only provides cover of €100,000 per calendar year, while an SME business (mkb), on the other hand, can manage with more limited cover. That is why it is important to always consult the insurer carefully.

As with private cyber insurance, there are also exclusions. For example, contractual liability is usually not insured. This concerns, for example, contractual penalties for late deliveries. Deliberate recklessness (read: insufficient security) or intent by employees is often not covered either.

What does cyber insurance cost?

Each insurer is of course free to set its own price. This price depends on various factors, such as the insured amount (per event and per year), the excess and the specific policy conditions. The sector in which you are active and your turnover are also decisive. Below are some price examples. These examples are for illustration only, have no reference date and do not reflect current premiums; a current premium can only be obtained from a quote. Also be aware that cyber insurance has only become more expensive in recent years. Cybercriminals are becoming increasingly cunning and the number of cyber attacks keeps rising; all this naturally affects the annual premium.

Bookshop with webshop

• Turnover: €250,000
• Insured amount: €250,000
• Premium per year: +/- €700

Accountancy firm

• Turnover: €1,000,000
• Insured amount: €1,000,000
• Premium per year: +/- €1,450

Manufacturing company

• Turnover: €8,000,000
• Insured amount: €2,000,000
• Premium per year: +/- €3,800

Saving on cyber insurance

There are only a few ways to save on cyber insurance. One of the simplest ways to adjust the annual premium is to lower the insured amount. Of course, it remains important to match the insured amount as closely as possible to the risks present. It also remains important to request several quotes, and commercial discounts in particular are possible, for example because several insurance products are taken out with the same insurer. Paying the premium annually instead of monthly also often results in an extra discount.

Insurers offering cyber insurance

Cyber insurance used to be a niche product, but nowadays it is offered by almost all insurers. This makes it possible to request countless quotes. You can go to the insurers below, among others. Do not immediately choose the cheapest quote, but compare the policy conditions, because there are often big differences. For example, by no means every cyber insurance policy will pay a ransom to criminals, while this is sometimes really a necessary (last) resort. Most Dutch insurers offer their website and policy documents in Dutch only.

• AIG Insurance
• Allianz
• Centraal Beheer
• de Vereende Verzekeringen
• Hiscox
• Interpolis
• Nationale-Nederlanden
• TVM