7 Cyber Insurance Claims Examples You Need to See in 2025

Cyber threats are no longer a distant possibility; they are a daily reality for businesses of all sizes. While a cyber insurance policy provides a crucial safety net, understanding how claims play out in the real world is the key to true preparedness. From ransomware attacks that halt operations to data breaches that shatter customer trust, the financial and reputational stakes are immense.

This guide moves beyond generic advice to provide a strategic breakdown of what happens during an incident. We will dissect 7 essential cyber insurance claims examples to reveal how coverage responds, why certain costs are covered, and the critical lessons learned from each scenario. By examining these detailed cases, you will gain the insights needed to not only select the right policy but also to implement preventative measures before an attack occurs.

Our analysis offers a clear view into the practical application of cyber insurance, demonstrating how a well-structured policy becomes a vital tool for business survival and resilience. You will learn to identify gaps in your current strategy and understand the tangible value a comprehensive cyber liability program delivers when faced with a real-world digital crisis.

1. Ransomware Attack and Business Interruption

Ransomware attacks represent one of the most frequent and disruptive cyber insurance claims examples, often causing a complete operational shutdown. In this scenario, malicious actors infiltrate a company’s network, encrypt critical data, and demand a ransom payment for its release. The resulting business interruption can be financially catastrophic, making robust cyber insurance coverage essential.

A successful claim for this type of event typically covers a wide range of expenses. These include the costs of a forensic investigation to determine the breach's scope, system restoration efforts, and potentially even the ransom payment itself, depending on the policy terms. Critically, the policy's business interruption component covers lost income and extra expenses incurred during the downtime.

Case Study Breakdown: JBS USA

In 2021, meat processing giant JBS USA fell victim to a sophisticated ransomware attack, forcing it to halt operations at numerous plants. The company ultimately paid an $11 million ransom to prevent further disruption and data exfiltration. This incident highlights the immense pressure and high stakes involved.

• Claim Trigger: Unauthorized network access leading to data encryption and operational shutdown.
• Covered Costs: The cyber insurance claim helped offset the massive financial blow, covering the ransom payment, forensic analysis, and significant business interruption losses from suspended production.
• Strategic Takeaway: JBS's decision to pay the ransom was a strategic choice to mitigate an even greater financial loss from prolonged downtime, a difficult decision many businesses face.

Actionable Insights & Best Practices

To effectively manage ransomware risk and ensure a successful claim, businesses must be proactive. In the devastating aftermath of a ransomware attack, professional ransomware cleanup services are often required to restore systems and data, mitigating the business interruption.

Key Strategy: Document everything. Meticulous records of your security protocols, incident response drills, and the attack's timeline are invaluable for substantiating your claim.

To prepare, focus on these key areas:

• Segregated Backups: Maintain regular, air-gapped, or cloud-isolated backups that cannot be compromised by the same network breach.
• Access Control: Implement multi-factor authentication (MFA) across all critical systems to create a stronger barrier against unauthorized access.
• Incident Response Plan (IRP): Develop and regularly test a detailed IRP. Knowing who to call and what steps to take before an attack occurs dramatically reduces recovery time and demonstrates due diligence to your insurer.

Understanding the potential financial impact is also crucial. For more details on this specific coverage, you can learn more about the factors influencing business interruption insurance cost.

2. Data Breach and Personally Identifiable Information (PII) Exposure

Among the most common cyber insurance claims examples, a data breach involving Personally Identifiable Information (PII) is a severe threat. This occurs when unauthorized actors access sensitive customer or employee data like names, social security numbers, or financial details. The fallout can lead to significant reputational damage and steep regulatory penalties.

A comprehensive cyber insurance policy is designed to manage the extensive costs following a PII breach. Coverage typically funds the forensic investigation, legal defense, regulatory fines, and public relations efforts. It also covers the direct costs of notifying affected individuals and providing them with credit monitoring services to mitigate potential identity theft.

Case Study Breakdown: Equifax

The 2017 Equifax data breach remains a landmark case, where the PII of approximately 147 million people was exposed. The breach stemmed from an unpatched software vulnerability, leading to a massive class-action lawsuit and a settlement of up to $700 million. It serves as a stark reminder of the financial consequences of failing to protect sensitive data.

• Claim Trigger: Unauthorized access to a database containing vast amounts of PII due to a known, unpatched vulnerability.
• Covered Costs: The insurance claim helped cover monumental expenses, including third-party liability from lawsuits, extensive notification costs, credit monitoring services for millions of victims, and substantial regulatory fines.
• Strategic Takeaway: Proactive vulnerability management is non-negotiable. The Equifax incident demonstrates that negligence in basic cybersecurity hygiene can trigger catastrophic financial and reputational losses.

Actionable Insights & Best Practices

To defend against PII exposure and ensure claim eligibility, organizations must demonstrate due care in protecting sensitive information. An effective response requires a pre-established framework for managing the incident from discovery to resolution.

Key Strategy: Practice data minimization. Only collect and store the personal data that is absolutely necessary for business operations to limit the scope of a potential breach.

To prepare, focus on these key areas:

• Regular Audits: Conduct routine security audits and vulnerability assessments to identify and patch weaknesses before they can be exploited.
• Data Governance: Establish and enforce clear data retention and deletion policies to ensure PII is not stored longer than needed.
• Breach Response Plan: A well-documented and tested plan is critical for a swift and compliant response. For a complete guide, review the essential components of a data breach response plan.

3. Social Engineering and Business Email Compromise (BEC)

Social Engineering and Business Email Compromise (BEC) represent a deceptive and highly effective form of cybercrime. Instead of brute-force hacking, attackers manipulate human psychology to trick employees into making fraudulent fund transfers or divulging confidential data. These schemes, often involving impersonating a CEO or a trusted vendor via a spoofed email, have led to billions in corporate losses and are a rapidly growing category among cyber insurance claims examples.

A successful BEC claim hinges on a policy with specific coverage for social engineering or fraudulent instruction. This coverage helps reimburse the direct financial loss from the unauthorized transfer. It also typically covers the costs of forensic accounting to trace the funds, legal fees, and expenses related to notifying affected parties, making it a critical shield against these targeted attacks.

Case Study Breakdown: Ubiquiti Networks

In 2015, networking technology company Ubiquiti Networks lost a staggering $39 million to a sophisticated BEC attack. Attackers impersonated company executives and sent fraudulent requests to the finance department, directing them to transfer funds to overseas accounts. The fraud went undetected until the funds were long gone, showcasing how easily even tech-savvy companies can be victimized.

• Claim Trigger: Fraudulent wire transfer instruction initiated by an employee who was deceived by a criminal impersonating a company executive.
• Covered Costs: The company's cyber insurance policy, specifically its social engineering fraud coverage, was triggered to cover a portion of the stolen funds and the extensive investigation costs required to unravel the scheme.
• Strategic Takeaway: The incident underscores that technology alone is not enough; human-centric controls and verification processes are the most critical defense against social engineering.

Actionable Insights & Best Practices

To combat BEC and ensure your insurance claim is successful, the focus must be on blending technology with rigorous human processes. In the event of a successful attack, a swift response is crucial, and knowing how to negotiate an insurance settlement effectively can make a significant difference in the recovery outcome.

Key Strategy: Implement a mandatory "out-of-band" verification process for all fund transfer requests. This means using a secondary, pre-established communication method (like a phone call to a known number) to confirm any request made via email.

To prepare, focus on these key areas:

• Dual Authorization: Require two separate individuals to approve any significant financial transaction or change to vendor payment details.
• Employee Training: Conduct regular, mandatory phishing and social engineering awareness training. Use simulation tests to measure employee vigilance and identify weak points.
• Email Authentication: Implement email security protocols like SPF, DKIM, and DMARC to make it harder for attackers to spoof your company's domain and impersonate executives.

4. Third-Party Vendor Data Breach Impact

A data breach originating from a third-party vendor is an increasingly common cyber insurance claim trigger, highlighting the interconnected nature of modern business. In this scenario, a company suffers a data compromise not through its own network but through a vulnerability in a trusted partner or software supplier. The resulting fallout can be just as damaging as a direct attack, affecting operations, customer trust, and regulatory compliance.

A successful claim for a third-party breach typically covers investigation costs, public relations efforts to manage reputational damage, and customer notification expenses. Depending on the policy, it may also cover regulatory fines, credit monitoring for affected individuals, and business interruption losses if the vendor’s failure halts your own operations. This makes it one of the more complex cyber insurance claims examples, as it involves multiple parties.

Case Study Breakdown: SolarWinds Supply Chain Attack

The 2020 SolarWinds attack was a landmark supply chain incident where state-sponsored actors injected malicious code into the company's Orion software updates. This compromised thousands of SolarWinds customers, including U.S. government agencies and Fortune 500 companies, who unknowingly installed the compromised software.

• Claim Trigger: A malicious software update from a trusted vendor created a backdoor into the networks of thousands of its customers.
• Covered Costs: Affected companies filed claims for forensic analysis to find and remove the threat, security system upgrades, and enhanced monitoring. Some policies also covered the costs of notifying stakeholders about the potential exposure.
• Strategic Takeaway: This attack proved that even with strong internal security, an organization's risk is directly tied to the security posture of its critical vendors.

Actionable Insights & Best Practices

To mitigate supply chain risk and strengthen your position for a claim, a proactive vendor management strategy is non-negotiable. As third-party vendor data breaches become more common, organizations must proactively manage associated risks. A crucial step is consulting a comprehensive guide to third-party risk assessment to build a resilient framework.

Key Strategy: Contractually mandate security standards. Your vendor contracts should explicitly detail cybersecurity requirements, incident notification timelines, and proof of their own cyber insurance coverage.

To prepare, focus on these key areas:

• Vendor Risk Management: Conduct thorough security assessments before onboarding any new vendor and perform regular audits thereafter.
• Contractual Obligations: Include a "right to audit" clause in vendor agreements and clearly define security responsibilities and breach notification protocols.
• Access Limitation: Implement the principle of least privilege, ensuring vendors only have access to the data and systems absolutely necessary for their function.

5. Cyber Extortion and Threat of Data Release

Cyber extortion goes beyond simple data encryption, involving threats to release sensitive stolen data if a payment is not made. Unlike traditional ransomware, where the primary leverage is operational disruption, this threat preys on reputational damage, regulatory fines, and loss of customer trust. Malicious actors demand payment to prevent the public disclosure of confidential information, creating a high-pressure crisis for the targeted organization.

A strong cyber insurance policy is designed to respond to these multifaceted threats. A successful claim can cover the costs of crisis management, including specialized negotiators who can engage with the threat actors. Coverage may also extend to the extortion payment itself (where legal), public relations efforts to manage reputational fallout, and the significant expenses associated with notifying affected individuals and providing credit monitoring services.

Case Study Breakdown: Garmin

In 2020, the GPS and wearable technology company Garmin was hit by an attack that not only encrypted its internal network but also involved the theft of company data. The attackers demanded a multi-million dollar payment to provide a decryption key and, critically, to prevent the release of the stolen information. This incident paralyzed their services, including aviation databases and customer-facing applications, for days.

• Claim Trigger: An extortion demand accompanied by a threat of public data release following a network compromise.
• Covered Costs: Garmin reportedly paid a significant sum through a third-party negotiator. Its cyber insurance claim likely helped cover the extortion payment, extensive forensic investigation, system restoration, and substantial business interruption losses from the global service outage.
• Strategic Takeaway: The dual threat of system lockdown and data exposure complicates the response. Garmin's decision reflects a calculated risk to prevent long-term brand damage and potential regulatory penalties, a common factor in these cyber insurance claims examples.

Actionable Insights & Best Practices

Responding to a data extortion threat requires a calm, strategic approach guided by experts. Engaging with threat actors directly without professional assistance can escalate the situation and jeopardize a successful resolution.

Key Strategy: Immediately engage your cyber insurance carrier's breach coach and incident response team. Their expertise in negotiation and threat validation is critical before any decisions are made.

To build resilience against cyber extortion, focus on these areas:

• Prevent Initial Access: Implement robust access controls, including multi-factor authentication (MFA) and least-privilege principles, to make it harder for attackers to steal data in the first place.
• Threat Intelligence: Monitor dark web forums and threat intelligence feeds for mentions of your company or compromised credentials, allowing you to proactively identify potential threats.
• Document Everything: In the event of a threat, meticulously document all communications and demands from the threat actor. This evidence is vital for law enforcement and for substantiating your insurance claim.

Understanding the full scope of your policy is essential. To see a detailed breakdown of what a policy might include for this type of event, you can learn more about what cyber insurance covers.

6. Network Security Failure and Denial of Service (DDoS) Attack

A Network Security Failure resulting in a Distributed Denial of Service (DDoS) attack is a brute-force cyber event designed to overwhelm a company's online infrastructure. In this scenario, attackers flood servers with massive volumes of traffic, rendering websites, applications, and services inaccessible to legitimate users. For businesses reliant on online availability, the resulting downtime can be just as damaging as a data breach, leading to significant revenue loss and reputational harm.

Cyber insurance claims for DDoS attacks typically cover the immediate costs of mitigation, such as hiring specialists to scrub the malicious traffic and restore service. Furthermore, the business interruption coverage is critical, compensating for lost profits and extra expenses incurred while systems were offline. As digital storefronts and online services become central to business operations, coverage for these availability-focused attacks is now a crucial component of many policies.

Case Study Breakdown: Dyn DNS Attack

In 2016, the DNS provider Dyn was hit by a massive DDoS attack that crippled major websites across the globe, including Twitter, Netflix, and PayPal. The attack leveraged a botnet of compromised IoT devices to generate overwhelming traffic, demonstrating how a single point of failure could have widespread consequences. The financial impact was estimated in the millions due to service outages for Dyn's high-profile clients.

• Claim Trigger: A massive influx of malicious traffic directed at critical network infrastructure, causing widespread service unavailability for customers.
• Covered Costs: Insurance claims would have addressed costs for emergency DDoS mitigation services, forensic analysis to identify the attack vector, and extensive business interruption losses for Dyn and its affected clients with contingent coverage.
• Strategic Takeaway: The Dyn attack highlighted the systemic risk in shared infrastructure. It underscored the need for not just direct protection but also for assessing the resilience of critical third-party vendors.

Actionable Insights & Best Practices

Proactive defense is the best strategy against DDoS attacks. A robust defense posture not only minimizes the chance of a successful attack but also demonstrates due diligence to insurers, which can be critical during a claims process.

Key Strategy: Layer your defenses. Relying on a single firewall or ISP-level protection is insufficient. A multi-layered approach combining on-premise hardware, cloud-based scrubbing services, and a CDN provides comprehensive resilience.

To prepare, focus on these key areas:

• DDoS Mitigation Services: Engage specialized providers like Cloudflare or Akamai to filter malicious traffic before it reaches your network.
• Redundant Infrastructure: Maintain failover systems and distribute assets across multiple data centers or cloud regions to avoid a single point of failure.
• Incident Response Plan (IRP): Develop a specific IRP for DDoS events. It should clearly define the steps to engage mitigation providers, communicate with customers, and reroute traffic.

Understanding how these events fit into a broader security framework is essential. You can learn more about developing a comprehensive approach by exploring the fundamentals of cyber security risk management.

7. Regulatory Fine and Compliance Violation Claims

When a cyber incident exposes sensitive data, the consequences extend beyond immediate recovery costs. Regulatory bodies are increasingly imposing steep fines for non-compliance with data protection laws like GDPR or CCPA. These penalties, which can reach millions, are a direct financial fallout from security failures and represent a critical area of coverage for modern businesses.

A robust cyber insurance policy can be a financial lifeline in these situations. Claims for regulatory actions typically cover the fines themselves, where insurable by law, as well as the substantial legal defense costs required to navigate complex investigations. The policy may also cover expenses for compliance remediation and crisis management consulting, making it a comprehensive backstop against regulatory scrutiny.

Case Study Breakdown: British Airways

In 2018, British Airways suffered a major data breach that compromised the personal and financial details of approximately 400,000 customers. The UK's Information Commissioner's Office (ICO) initially intended to fine the airline a record £183 million for failing to protect customer data, a penalty made possible under GDPR. Though later reduced to £20 million after considering BA's response and the economic impact of the pandemic, the fine remained a significant financial blow.

• Claim Trigger: A data breach resulting in a formal investigation and subsequent fine by a regulatory authority (ICO) for GDPR violations.
• Covered Costs: The cyber insurance claim helped address the multi-faceted financial impact, covering legal defense fees during the lengthy investigation and a portion of the final £20 million penalty.
• Strategic Takeaway: This case demonstrates that even a reduced fine can be substantial. Proactive compliance and a swift, transparent response can mitigate penalties, but insurance remains essential to cover the final liability.

Actionable Insights & Best Practices

To defend against regulatory actions and ensure a claim is successful, organizations must demonstrate a culture of compliance. This involves more than just having security tools; it requires a documented, proactive approach to data governance and privacy.

Key Strategy: Comprehensive documentation is your best defense. Maintain meticulous records of security policies, compliance audits, and privacy impact assessments to prove due diligence to regulators and your insurer.

To prepare, focus on these key areas:

• Regular Audits: Conduct regular internal and external audits against applicable regulations (GDPR, CCPA, etc.) to identify and remediate gaps before an incident occurs.
• Stay Informed: Data privacy laws are constantly evolving. Assign responsibility for monitoring regulatory changes in all jurisdictions where you operate to ensure continuous compliance.
• Board-Level Reporting: Establish a clear channel for reporting on compliance status and cyber risk to the board. This demonstrates executive oversight, a key factor regulators assess.

7-Case Cyber Insurance Claims Comparison

Threat / Claim	Implementation Complexity 🔄	Resource Requirements ⚡	Expected Outcomes 📊	Ideal Use Cases 💡	Key Advantages ⭐
Ransomware Attack and Business Interruption	High — coordinated forensics, restoration and legal steps required	High — IR teams, backups, potential ransom, extended downtime costs	Data recovery and business-interruption reimbursement; variable recovery timelines	Critical-availability environments (healthcare, utilities, manufacturing)	Comprehensive financial protection; access to specialists; possible extortion coverage
Data Breach & PII Exposure	Medium–High — notification, legal and regulatory workflows + root-cause analysis	High — credit monitoring, legal defense, regulatory fines, PR services	Notification compliance, identity protection for victims, reputational mitigation	Organizations handling large volumes of PII (retail, finance, healthcare)	Covers notification/PR costs and legal defense; helps manage regulatory risk
Social Engineering / BEC	Medium — investigation and proof of fraud vs. negligence can be complex	Medium — forensic accounting, bank coordination, employee training	Coverage for fraudulent transfers and recovery efforts; often limited recovery success	Companies performing frequent high-value wire transfers; remote-work teams	Covers direct financial loss and bank/law enforcement coordination
Third-Party Vendor Data Breach Impact	High — cross-entity investigations and shared-liability determination	Medium–High — vendor audits, remediation, alternative arrangements	Vendor-related BI coverage, notification and remediation support	Organizations reliant on MSPs/SaaS or complex supply chains	Protects risks outside direct control; incentivizes stronger vendor security
Cyber Extortion / Threat of Data Release	Medium–High — negotiation, threat analysis, crisis communications	Medium — negotiators, crisis PR, threat intelligence; payments often restricted	Threat mitigation, crisis management and limited restoration; payments may not guarantee outcome	High-profile targets or organizations facing extortion threats	Access to professional negotiators and crisis teams; law enforcement coordination
Network Security Failure / DDoS Attack	Medium — traffic analysis and mitigation orchestration required	Medium — DDoS mitigation services, redundancy, CDN and monitoring	Rapid mitigation and reduced downtime; revenue protection during attack window	Internet-facing services, e-commerce, online platforms	Fast-response mitigation providers; minimizes service disruption
Regulatory Fine & Compliance Violation Claims	Medium — legal defense, remediation planning and regulatory negotiation	High — legal fees, compliance remediation, audits and consultancy	Potential payment of fines (subject to policy and jurisdiction), compliance remediation	Highly regulated industries and large data controllers	Legal expertise for appeals and remediation; may reduce financial/regulatory impact

Turning Insight Into Action: Your Next Steps in Cyber Resilience

The real-world cyber insurance claims examples we've explored do more than just illustrate potential threats; they provide a strategic roadmap for building a more resilient organization. From devastating ransomware attacks halting operations to subtle social engineering scams siphoning funds, each scenario underscores a critical truth: your insurance policy is a vital backstop, but your daily security posture is your first and most important line of defense.

These cases reveal that the true cost of a cyber incident extends far beyond the initial financial demand. It encompasses business interruption losses, regulatory fines, legal fees, credit monitoring services, and the long-term, often uninsurable, cost of reputational damage. The throughline connecting all these examples is the undeniable value of proactive preparation meeting comprehensive, tailored coverage.

Key Learnings from Real-World Claims

Analyzing these cyber insurance claims examples brings several core strategies into sharp focus. The most successful outcomes consistently involved organizations that had already invested in a multi-layered defense strategy.

• Prevention is Paramount: Robust security protocols, including multi-factor authentication (MFA), regular system patching, and advanced endpoint detection, are no longer optional. They are the foundation of insurability and resilience.
• Human Firewall is Critical: As seen in the Business Email Compromise (BEC) example, technology alone is not enough. Ongoing, realistic employee training on phishing, social engineering, and data handling protocols can prevent the majority of incidents before they start.
• Vendor Risk is Your Risk: The third-party data breach claim is a stark reminder that your security is only as strong as your weakest link. Rigorous vendor due diligence and contractual requirements for security are essential risk management tactics.
• Incident Response Matters: Having a tested and proven Incident Response Plan (IRP) is not just a best practice; it is a necessity that can dramatically reduce the financial and operational impact of an attack.

Your Actionable Path to Cyber Resilience

Simply understanding these cyber insurance claims examples is not enough. The next step is to translate these insights into concrete actions that fortify your organization against the very threats detailed in this article.

1. Conduct a Comprehensive Risk Assessment: Use these claim scenarios as a guide. Where are your vulnerabilities? Evaluate your defenses against ransomware, data breaches, social engineering, and supply chain attacks.
2. Review and Enhance Your Security Controls: Don't wait for an incident to discover a weakness. Implement or strengthen key controls like MFA, network segmentation, and regular, verified data backups that are stored offline and isolated from the main network.
3. Align Your Policy to Your Risks: Scrutinize your current cyber insurance policy. Does it offer adequate coverage for business interruption, regulatory fines, and third-party liabilities? Ensure your policy limits and sub-limits reflect the real-world costs seen in these claims. Partner with an expert who can identify potential gaps between your risks and your coverage.

Ultimately, mastering these concepts moves your organization from a reactive stance to a proactive position of strength. It transforms cyber insurance from a simple expense into a strategic component of a holistic risk management program. By taking these deliberate steps today, you are not just buying a policy; you are investing in the continuity and long-term success of your business in an increasingly complex digital world.

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Don't navigate the complexities of cyber risk alone. The team at Wexford Insurance Solutions uses deep industry knowledge, informed by countless real-world cyber insurance claims examples, to help you build a comprehensive risk management program. Contact Wexford Insurance Solutions today to ensure your coverage is perfectly aligned with your unique operational risks.