As cybersecurity threats become increasingly sophisticated, businesses are increasingly turning to insurers for effective strategies on proactive protection and prevention. Recent findings from Traveler’s latest Risk Index reveal that an impressive 86% of business leaders express confidence in the cybersecurity guidance offered by insurance carriers, surpassing their trust in third-party vendors and service providers.
Despite the growing consensus regarding the importance of cyber insurance—80% of respondents affirming its critical nature—only 63% have actually secured such coverage. This data highlights an untapped market for insurers to engage with a concerned yet underserved audience. Alarmingly, 46% of small businesses reported lacking any form of cyber coverage, while 21% of mid-sized and large organizations are similarly unprotected against potential cyberattacks.
“These insights present a compelling overview of how individuals and companies perceive cybersecurity threats and their current defenses,” stated John Menefee, Vice President and Enterprise Cyber Lead at Travelers. “Awareness of these risks and implementing a robust cybersecurity program can distinguish businesses that flourish from those that are derailed by significant breaches.”
Most Concerning Cyber Risks
Over the past decade, reported cybercrimes have surged by 150%, with 60% of victims experiencing multiple incidents. According to a survey of 1,200 business decision-makers nationwide, many have already faced cyberattacks and security breaches. Key statistics show that 39% encountered unauthorized access breaches, while 28% reported system glitches or user errors. Furthermore, 27% noted hazardous practices among employees, and 24% fell prey to extortion or ransomware attacks.
For the ninth time in the last decade, the percentage of organizations reporting cyber incidents has risen, reaching 25% this year, compared to 24% in 2024. Nearly half of the respondents expressed concern over losses from social engineering fraud (SEF) schemes, where employees are manipulated into transferring funds through misleading emails or messages. These scams are escalating, fueled by the adoption of AI technologies that allow for increasingly convincing and urgent communication.
A significant 56% of business leaders worry about security breaches and hackers, while concerns about unauthorized access to financial accounts (55%) and compromised client records (53%) closely follow. Additionally, the potential for security gaps through vendors (53%) and threats from cyber extortion or ransomware (53%) are major concerns, as is the risk posed by employees who might inadvertently expose information or facilitate system breaches (51%). Cybersecurity has emerged as the leading concern for decision-makers in large and medium-sized organizations.
The Role of Cyber Insurers
Insurers stand at a crucial juncture, equipped to act as trusted advisors to businesses navigating the increasingly complex landscape of cyber threats. Companies leveraging online technologies are vulnerable to cybercrime, which varies significantly across different sectors. While many organizations recognize the urgency of enhancing their cybersecurity, over 20% admit to not implementing fundamental protective measures. This includes 24% not deploying firewall protection, with similar percentages for data backups and software updates, demonstrating a critical knowledge gap.
Insurance providers are positioned to assist their clients in securing adequate coverage and developing effective security strategies. By focusing on education and proactive measures, insurers can help mitigate risks and reduce overall costs associated with cyber incidents. “Continuous vigilance is essential. The key to effective cyber defense is remaining proactive,” advised Lauren Winchester, Vice President of Cyber Risk Services at Travelers. “Complacency is a major pitfall; businesses must persist in their investments in cybersecurity.”
The complete findings are available in the 2025 Travelers Cyber Risk Index, which surveys over 1,200 business decision-makers on pertinent cyber-related issues.
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