Does Cyber Insurance Cover Phishing Attacks? (Yes—but Here’s What You Need to Know)

Does Cyber Insurance Cover Phishing Attacks? (Yes—but Here’s What You Need to Know)

Phishing attacks have become one of the most common and costly forms of cybercrime today. Whether you're running a small business or a large organization, a single phishing email can compromise sensitive data and lead to serious financial losses.

So, here’s the big question: Does cyber insurance cover phishing?
Yes—but the details matter.

What Is a Phishing Attack?

Phishing is a type of cyber attack where criminals impersonate a legitimate organization—such as a bank, vendor, or even your own company—to trick individuals into revealing sensitive information. This could include usernames, passwords, credit card details, or access to internal systems.

Most phishing attacks fall under a broader category known as social engineering, which involves psychological manipulation to get victims to take an action that compromises security—like clicking a malicious link or wiring funds to a fraudulent account.

Does Cyber Liability Insurance Cover Phishing?

In many cases, yes.

Cyber liability insurance is designed to protect your business against a wide range of cyber threats—including phishing and other social engineering attacks. Depending on the policy, coverage may include:

• Customer Notification Costs: If sensitive data is exposed, your business may be required to notify all affected parties.
• Credit Monitoring Services: Coverage may include the cost of credit monitoring for affected customers or employees.
• Legal Defense and Settlements: If your business is sued due to the phishing incident, legal fees and potential judgments may be covered.
• Financial Loss Reimbursement: Some policies may reimburse direct financial losses resulting from the attack.

But Not All Policies Are the Same

This is where the “but” comes in. Coverage varies widely depending on your insurer and policy terms. Some cyber insurance policies cover only certain aspects of a phishing attack, such as notification and legal fees, but not the financial losses. Others may exclude certain types of social engineering unless specific endorsements are added.

What Should You Do?

To make sure you're properly protected, consider these steps:

1. Review Your Current Cyber Insurance Policy
   Understand what’s covered and what’s excluded, especially when it comes to phishing and social engineering.
2. Ask About Endorsements
   Some insurers offer optional endorsements for broader coverage of social engineering and fraudulent instruction attacks.
3. Talk to an Insurance Professional
   An experienced insurance agent can help you compare policies, identify coverage gaps, and ensure your business is protected against modern cyber threats.

Final Thoughts

Phishing attacks are a serious risk in today’s digital world—and while many cyber insurance policies do cover them, the extent of that coverage isn’t always clear-cut. Don’t wait until after an attack to find out what your policy does or doesn’t include.

Have questions about cyber insurance and phishing coverage? Contact us today to review your policy and make sure your business is protected.