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2025 Market Outlook: Cyber Insurance

April 2, 2025

Cyber Insurance in 2025: What Business Owners Need to Know

As cyber threats evolve, the cyber insurance market remains volatile, making it difficult to predict pricing trends. Major cyber incidents, such as the CrowdStrike and Change Healthcare breaches, have demonstrated how a single attack or programming error can disrupt multiple industries. While rates have been trending downward, insurers may impose stricter underwriting requirements in 2025 due to the increasing risk of large-scale cyber events. Policyholders should expect variability in coverage terms, pricing, and requirements based on their industry and risk profile.

Key Cyber Risks for 2025

  • Ransomware Attacks at Record Highs – Ransomware remains one of the biggest cyber threats, with 2024 already breaking records for payments to cybercriminals. Critical industries like healthcare, education, and government agencies are primary targets, as attackers believe they are more likely to pay ransoms to avoid disruption.
  • AI-Powered Cybercrime – Cybercriminals are increasingly using AI to automate hacking, crack passwords, and launch sophisticated scams. One emerging threat is deepfake fraud, where AI-generated voices or videos impersonate executives or employees to manipulate financial transactions or breach security systems.
  • Supply Chain Vulnerabilities – Many cyberattacks exploit third-party vendors with weaker security measures. These attacks can infiltrate an organization through compromised software, data storage gaps, or insecure supplier networks. Experts predict nearly half of organizations will experience software supply chain attacks by 2025.
  • Data Privacy Compliance Risks – With businesses collecting more personal data through biometrics, tracking technology, and digital marketing tools, data privacy laws are tightening. Regulations like GDPR, HIPAA, BIPA, and California’s CPRA impose heavy fines for non-compliance, and more states are adopting stricter privacy rules in 2025.

How to Protect Your Business

Train employees on cybersecurity risks – Staff should recognize threats like AI-driven phishing, deepfake scams, and ransomware tactics.

Develop a strong cyber incident response plan – Regularly test your plan with simulated cyberattacks to ensure rapid response and minimal damage.

Vet third-party vendors – Conduct cybersecurity assessments before partnering with vendors to ensure they meet your security standards.

Stay compliant with data privacy laws – Work with legal and insurance professionals to understand evolving regulations and avoid costly penalties.

With cyber risks escalating, businesses must take a proactive approach to cybersecurity in 2025. Investing in risk management and strong cyber insurance coverage can help safeguard your operations against financial and reputational damage.

Connect with your Robertson Ryan Insurance agent for Cyber Security options that meet your unique needs. For more info, here is a printable handout link, from Zywave.

*Please note that we rely on independent sources, and recommend conducting further research or to seek guidance from a qualified industry professional, legal counsel, or licensed insurance agent as appropriate for your needs. These blog posts are intended for general informational purposes only.