The 5 Best Cybersecurity Insurance Providers for Small Businesses in 2025
Important Disclaimer: This article is for informational and educational purposes only and does not constitute insurance or legal advice. I am not a licensed insurance broker. You must consult with a qualified, licensed insurance professional to assess your specific risks and find a suitable policy.
For a small business, a single data breach or ransomware attack can be a catastrophic, company-ending event. The cost of forensic investigations, data recovery, legal fees, and reputational damage can easily run into hundreds of thousands of dollars. Your standard business insurance won’t cover it. This is why cybersecurity insurance has become an essential layer of protection for any modern business.
But this is one of the most complex types of insurance to buy. What’s covered? What’s excluded? And how do you choose a provider that not only pays claims but also helps you prevent attacks in the first place? We’ve researched the top providers in the market to help you understand your options and make an informed decision with a licensed professional.
How to Understand & Choose Cybersecurity Insurance
Before you look at providers, you need to understand the fundamentals of a cyber policy. Here’s what matters most:
First-Party vs. Third-Party Coverage: What’s the Difference?
A comprehensive policy includes both types of coverage to protect you from all angles.
- First-Party Coverage: Covers your direct financial losses from a cyber incident. This includes costs for:
- Hiring forensic IT experts to investigate the breach.
- Notifying affected customers.
- Credit monitoring services for victims.
- Public relations to manage reputational damage.
- Ransomware extortion payments.
- Business interruption costs from downtime.
- Third-Party Coverage: Covers your liability when others sue you as a result of a cyber incident. This includes:
- Legal defense costs.
- Settlements and judgments.
- Regulatory fines and penalties (e.g., from HIPAA, GDPR, or CCPA violations).
Key Factors to Evaluate
- Coverage Limits & Deductible: How much will the policy pay out for a claim, and how much do you have to pay out-of-pocket (the deductible) before coverage kicks in?
- Policy Exclusions: What is *not* covered? Common exclusions include acts of war, failure to maintain security standards, or losses from unpatched, known vulnerabilities. Read the fine print carefully.
- Incident Response Services: The best insurers provide 24/7 access to a team of experts (a “breach coach”) the moment you suspect an incident. This immediate access to legal and technical help is one of the most valuable parts of a policy.
- Proactive Security Tools: A new generation of providers now includes free or discounted cybersecurity tools and scanning to help you reduce your risk *before* an attack happens.
1. Coalition
Best for Proactive Security & InsuranceCoalition is a leader in the new wave of “active insurance.” They’re not just an insurance provider; they’re a cybersecurity company that bundles comprehensive insurance with a suite of proactive security tools and services. Policyholders get access to continuous security monitoring, threat alerts, and expert guidance, all designed to prevent incidents from happening. This unique combination of risk mitigation and risk transfer makes them a top choice for any small business.
Key Coverages:
- Comprehensive first-party and third-party liability coverage.
- Funds transfer fraud and social engineering coverage.
- Business interruption and extra expense coverage.
- Access to a 24/7 incident response team.
Pros
- Includes a suite of free, proactive cybersecurity tools.
- Continuous monitoring helps identify risks before they’re exploited.
- Streamlined, data-driven underwriting process.
- Excellent, in-house incident response and claims team.
Cons
- Requires a higher level of security maturity to qualify.
- Can be more expensive if your security posture is weak.
Our Research Highlight
Coalition’s value proposition is its “Active Risk Platform.” Our research found that they provide policyholders with a dashboard that shows their specific security weaknesses and recommendations. For example, if they detect an open port on your network, they will alert you so you can fix it. This approach can actively lower your chance of having a claim, which is a powerful differentiator.
Access Method: Typically through an authorized insurance broker.
Learn About Coalition2. At-Bay
Best for Active Risk MonitoringSimilar to Coalition, At-Bay operates on the principle that better security leads to better insurance. They use an automated scanning platform to continuously monitor their policyholders’ security posture for vulnerabilities. By identifying and helping businesses remediate these weaknesses, they aim to reduce claims for everyone. Their focus on technology and active risk management makes them a strong competitor in the modern cyber insurance landscape.
Key Coverages:
- Broad coverage for data breaches, ransomware, and business interruption.
- Coverage for social engineering and invoice manipulation.
- Media liability coverage for copyright/trademark infringement.
- 24/7 access to a breach coach and technical forensics team.
Pros
- Active vulnerability scanning and security alerts.
- In-house security team provides expert guidance.
- Strong focus on preventing ransomware attacks.
- Data-driven approach to underwriting and pricing.
Cons
- May deny coverage for businesses with poor security practices.
- Fewer in-house claims staff than some larger, traditional carriers.
Our Research Highlight
At-Bay’s emphasis on active monitoring stood out in our research. We learned that their security team actively helps clients during major global cyber events, like the Log4j vulnerability. They scanned their entire portfolio of clients, identified those who were vulnerable, and provided direct, actionable advice on how to patch their systems. This hands-on partnership is a huge value-add beyond just the policy itself.
Access Method: Through an authorized insurance broker.
Explore At-Bay3. The Hartford
Best Established Insurer for SMBsThe Hartford is a well-respected, century-old insurance carrier that has developed a strong and comprehensive cyber insurance product called CyberChoice First Response. For businesses that value the stability, brand recognition, and claims-paying history of a traditional insurer, The Hartford is an excellent choice. Their policies are robust, and they offer a range of risk management resources to help businesses prepare for an incident.
Key Coverages:
- Data breach response and notification costs.
- Coverage for cyber extortion and ransomware.
- Business income loss and dependent business interruption.
- Reputational harm coverage.
Pros
- Backed by a financially strong and stable A+ rated carrier.
- Strong reputation for handling claims efficiently.
- Can be bundled with other business insurance policies (like a BOP).
- Provides access to valuable pre-breach risk management services.
Cons
- Less focus on proactive, built-in security tools compared to Coalition/At-Bay.
- The application process can be more traditional and slower.
Our Research Highlight
Our analysis focused on The Hartford’s established infrastructure. Their key strength is their vast experience in handling claims across all lines of insurance. While newer providers focus on tech, The Hartford’s expertise lies in the complex legal and financial aspects of a claim. For a business owner who prioritizes a smooth, predictable claims process above all else, this long-standing reputation is a significant advantage.
Access Method: Through an independent agent or broker.
Find a Hartford Agent4. Chubb
Best for Comprehensive CoverageChubb is another premier, global insurance carrier known for its comprehensive policies and world-class claims service. They are often considered a top choice for mid-sized and larger businesses but also offer excellent solutions for small businesses. Their cyber policies are known for being broad and clearly worded, with a focus on covering a wide range of potential cyber-related losses. Their financial strength is second to none.
Key Coverages:
- Broad definition of what constitutes a cyber incident.
- Coverage for “bricking” (hardware rendered useless by malware).
- Worldwide coverage territory.
- Industry-specific underwriting and risk management.
Pros
- Exceptional financial strength (A++ rating).
- Renowned for its fair and fast claims handling.
- Comprehensive policy language with fewer gray areas.
- Global capabilities for businesses with international exposure.
Cons
- Premiums are often higher than other providers.
- Very strict underwriting requirements.
Our Research Highlight
Chubb’s reputation for claims handling was a consistent theme in our research. We reviewed industry reports and broker feedback that frequently cited Chubb as a leader in paying claims fairly and efficiently. Their pre-vetted panel of incident response experts is considered among the best in the business. When a crisis hits, knowing you have a carrier with this level of financial and operational strength is incredibly valuable.
Access Method: Through an independent agent or broker.
Talk to a Chubb Broker5. Embroker
Best Digital Brokerage ExperienceEmbroker is a modern digital insurance brokerage, not a carrier. They’ve built a technology platform that makes the process of buying business insurance, including cyber insurance, faster and easier. You can complete an online application, compare quotes from multiple A-rated carriers, and bind a policy in minutes. For tech-savvy business owners who want a streamlined, transparent purchasing experience, Embroker is an excellent choice.
Key Coverages:
- Policies sourced from multiple top-tier carriers.
- Coverage is tailored to your business needs through their platform.
- Includes all standard first-party and third-party coverages.
- Clear presentation of policy limits, sub-limits, and deductibles.
Pros
- Fast, simple, fully digital application and purchasing process.
- Allows you to easily compare quotes from different insurers.
- Transparent presentation of coverage and pricing.
- Good for bundling multiple types of business insurance.
Cons
- You are buying a policy from a carrier, not Embroker itself.
- Less hands-on risk management support compared to Coalition.
Our Research Highlight
We walked through Embroker’s online application process. It was remarkably intuitive, asking plain-language questions about our hypothetical business’s revenue, industry, and security controls. Within about 10 minutes, the platform presented several comparable quotes from different carriers. This ability to instantly shop the market and compare options is a powerful advantage that demystifies the traditionally opaque insurance buying process.
Access Method: Direct, through their online platform.
Get a Quote on EmbrokerAt a Glance: Provider Comparison
| Provider | Best For | Key Feature | Access Method | Carrier or Broker? |
|---|---|---|---|---|
| Coalition | Proactive Security | Free security tools included | Broker | Carrier (MGA) |
| At-Bay | Risk Monitoring | Active vulnerability scanning | Broker | Carrier (MGA) |
| The Hartford | Established SMB Choice | Strong claims history | Broker/Agent | Carrier |
| Chubb | Comprehensive Coverage | World-class claims service | Broker/Agent | Carrier |
| Embroker | Digital Experience | Online quote comparison | Direct Online | Broker |
Our Research Methodology
Our evaluation of cybersecurity insurance providers was based on a comprehensive analysis of publicly available information and industry standards.
- Policy Analysis: We reviewed sample policy documents and coverage summaries to understand what is typically included and excluded.
- Feature & Service Review: We analyzed the value of ancillary services, such as included security tools, risk management resources, and the quality of incident response panels.
- Industry Reputation: We assessed the provider’s reputation by reviewing financial strength ratings from AM Best and feedback from insurance industry publications and broker communities.
- User Experience: For digital platforms like Embroker, we went through the online application and quote process to evaluate its ease of use and transparency.
Frequently Asked Questions (FAQ)
My business is small. Do I really need cyber insurance?
Yes. Small businesses are often targeted by cybercriminals precisely *because* they tend to have weaker security controls than large corporations. According to industry reports, over 40% of cyberattacks target small businesses. Since you likely don’t have a dedicated security team or the financial resources to absorb a major breach, a cyber insurance policy is a critical financial backstop.
Will my General Liability or Business Owner’s Policy (BOP) cover a data breach?
Almost certainly not. Most modern general liability and BOP policies have specific exclusions for cyber-related events and data breaches. They are designed to cover physical risks like bodily injury or property damage. To be covered for a cyber incident, you need a dedicated, standalone cybersecurity insurance policy.
What can I do to get a better price on my premium?
Insurers will give you a better rate if you can demonstrate a strong security posture. Key measures include implementing multi-factor authentication (MFA) on all critical accounts (especially email), having regular offsite data backups, providing security awareness training for employees, and maintaining a formal incident response plan. The more you do to reduce your risk, the more insurable you become.
