Making Sure Your Business Actually Qualifies for Cyber Insurance Coverage
With cyberattacks on the rise and the average cost of a breach growing every year, cyber insurance has become essential for small and mid-sized businesses. As ransomware, phishing, and data theft continue to grow, these policies promise a financial safety net when something goes wrong.
But here’s the trap that too many businesses fall into. They assume just having a policy doesn’t mean you’re protected or that the insurer will pay.
Many businesses assume that answering “yes” on a cyber insurance application: Do you use MFA? Do you back up your data? is enough. But if those answers don’t hold up during a post-breach investigation, your claim could be denied.
At TeamMIS, we’ve seen it happen: a business checks all the right boxes, but when a real incident occurs, the insurer uncovers gaps and coverage disappears.
If you’re not working with your IT partner to ensure your security controls match your policy requirements, you may be paying for protection you can’t actually use.
A False Sense of Security
Cyber insurance applications ask questions like:
- Do you require MFA for all users?
- Do you conduct regular data backups?
- Do you provide cybersecurity awareness training?
- Do you have an incident response plan?
Many businesses click “yes” to keep the application process moving. But there’s a difference between saying you have control and demonstrating that it’s implemented, monitored, and enforced.
And when something goes wrong, insurance underwriters will dig deep.
What Insurers Look for After a Breach
If your company suffers a cyberattack and files a claim, the insurer may request:
- Logs showing MFA activity or access control enforcement
- Proof that backups were maintained, encrypted, and tested
- A written and tested incident response plan
- Evidence of employee training and phishing simulations
If you can’t provide what you claimed to have, you risk:
- Claim denial
- Loss of renewal eligibility
- Higher premiums or dropped coverage
Cyber policies often include detailed “warranty clauses” statements that you warrant specific controls are in place and functioning. If those controls aren’t validated, your coverage may not apply at all.
Cyber Insurance Is Getting Stricter
Insurers are tightening their requirements and increasing premiums in response to rising attack volume and payout frequency.
Businesses that can’t demonstrate proper controls may:
- Be denied coverage during the application process
- Face significantly higher premiums
- Be held responsible for breach costs they thought were covered
At TeamMIS, we often find that businesses don’t fully understand what their policy requires, or they’re relying on outdated or informal controls that won’t pass an insurer’s scrutiny.
TeamMIS’s Advice: Review Your Policy With Your IT Partner
If you’re not reviewing your cyber insurance policy with your IT provider, you’re taking a major risk. At TeamMIS, we help companies understand, validate, and document the technical controls required by their policies so they’re truly covered when it counts.
Here’s How We Help:
- Policy-to-Controls Review
We sit down with your insurance documentation and map each requirement to your actual systems, tools, and configurations.
- Risk Gap Analysis
If something is missing or isn’t fully enforced, we help you close the gap. That might mean enabling full-device MFA, securing your backups, or implementing endpoint protection.
- Documentation & Logging Setup
We ensure you have the documentation and reporting tools in place to prove compliance if an incident occurs.
- Employee Security Training
We offer security awareness training for your team so you can show insurers you’re actively reducing human risk.
- Incident Response Planning
We help develop and document an actionable, testable response plan that’s aligned with what insurers want to see.
Compliance Isn’t a Checkbox. It’s a Partnership
Cyber insurance is an important safety net, but only if it’s backed by real, enforceable security controls. Clicking “yes” on a policy questionnaire without verifying your technical readiness can leave your business exposed twice: once to the attacker, and again when your claim is denied.
Make sure your coverage actually counts!
TeamMIS helps small businesses align their IT practices with their cyber insurance requirements. So you’re covered when it matters most.
👉 Schedule your free Cyber Insurance Compliance Review today
