As cyber threats continue to escalate, cyber insurance is becoming an essential safeguard for businesses, particularly small and midsize enterprises (SMBs). These companies often have limited cybersecurity resources and are vulnerable to attacks.
Cyber insurance providers are increasingly integrating proactive risk management into their policies.
The Coalition’s Cyber Threat Index 2025 underscores the growing importance of insurance in addressing the financial and operational repercussions of cyberattacks. The report highlights ransomware as a significant driver of claims. It states that most ransomware incidents originate from breaches of perimeter security appliances or remote desktop software. Stolen credentials and software exploits remain common entry points, and exposed login panels continue to pose a major risk.
Coalition’s analysis revealed over 5 million internet-exposed remote management solutions, a vulnerability that cybercriminals often exploit. With an estimated 45,000 software vulnerabilities projected to be published in 2025, businesses face substantial security challenges.
In response, insurers are taking action by integrating proactive risk management into their policies. Coalition’s cyber insurance model merges traditional coverage with real-time threat monitoring and security alerts, helping policyholders mitigate risks before they escalate. AI-driven risk prioritization has enabled Coalition to issue targeted Zero-Day Alerts, flagging only the most critical vulnerabilities.
In 2024, the majority of alerts sent to policyholders centered on misconfigurations, such as exposed login panels and outdated software, which can leave businesses open to attack.
For SMBs, which often lack dedicated cybersecurity teams, insurance is taking on a more active role in risk mitigation. While 60% of SMB owners identify cybersecurity as a top concern, only 23% feel adequately prepared to handle an attack. Responding to this, insurers are setting stricter security requirements for coverage, encouraging businesses to adopt measures such as multi-factor authentication (MFA), software updates, and proactive vulnerability management, according to the report.
As cyber threats evolve, the insurance industry is shifting from simply providing financial recovery to actively preventing attacks. Evidence from Coalition suggests that businesses prioritizing robust security practices not only reduce their exposure to cyber risks, but also improve their insurability, potentially leading to lower costs in the long run.
