In our previous newsletter we discussed how cybersecurity controls and baselines that were once considered optional by some organizations are now considered the bare minimum. One of the contributing factors to this new reality is the increasingly strict requirements being implemented into cybersecurity insurance policies.
Challenges with Cyber Security Insurance
In years past, many organizations would neglect making proper investments into their technology stack and would rely on their cyber insurance policy to be a safeguard in the event they were breached. While this solution ignores the reputational damage that can come after a compromise, the financial incentives at the time made this an ill-advised but understandable decision. However, as the frequency and sophistication of cyber-attacks have increased, so have the requirements from policy writers to minimize their own risk.
An additional challenge is that the valuation of data can be difficult to determine. As a result, if an insurance company does payout for an incident, the value of this can be low.
What We Are Observing Today
In today’s landscape we are seeing a shift in how insurance policies are being written, the requirements to apply for insurance increasing, and the number of successful payouts in the event of a breach reducing.
An example from the City of Hamilton in 2025 perfectly illustrates this point. Their insurance company did not cover the breach because not all departments were using multi-factor authentication, which created a major security blind spot.
There is also a disconnect between how vulnerable SMEs feel and how vulnerable they are. A survey from 2025 found that only 48% of SMEs feel vulnerable to a cyber attack or data breach. However, research from BDC shows 73% of small businesses have experienced an incident. Another concern is that only 26% of Canadian businesses have cyber security insurance policies.
Risk Management is Multi-Layered
Just like a strong IT technology stack, an organization’s risk management should be multi-layered to provide the best protection. IT solutions and insurance policies should not be viewed as separate entities. Instead, they should be considered cooperative foundations within your organization’s overall risk management strategy.
A strong combination of security baselines, modern IT policies, and comprehensive cyber security insurance can significantly minimize risk.
Conclusion
Many baseline IT security requirements are now mandatory for cyber insurance policies. Despite the increasing number of cyber threats across Canada, a relatively small percentage of businesses carry cyber insurance. This can have significant financial consequences in the event of a breach.
The growing complexity of these policies may also push them further out of reach for small businesses, potentially making them more attractive targets for threat actors.
CSOLVE is here to help. With our multi-layered approach to IT and network security, we can help your business implement stronger safeguards while improving your eligibility for cyber insurance coverage.
Contact us today to get started.
Community Event
The annual Bowl for Kid’s Sake event supporting Big Brothers Big Sisters of North Simcoe is coming up on April 10th and 11th. Events will take place across Midland, Penetanguishene, and Springwater.
Team registration is now open, so gather your team and get your neon gear ready for this fun community event supporting an important cause.
Learn more:
Bowl for Kid’s Sake