Cyber insurance is no longer just a concern for businesses. As digital risks grow, they are affecting individuals and families too. Mila Araujo, AVP at DigitalShield and leader of the personal cyber insurance practice at NFP, shared insights on how this type of coverage is slowly becoming a regular part of personal insurance.
Araujo points out that insurance often starts with optional add-ons that people may resist at first. But over time, as risks become clearer, these coverages turn into essential protections. She compares personal cyber insurance to coverages like water damage, earthquake insurance, and identity theft protection, which were once optional but are now widely accepted and valued.
Many people don’t realize that personal cyber insurance exists or think it’s only for companies. The technical nature of cyber risks—terms like malware and ransomware—can be confusing. To help, Araujo suggests focusing on the real-life impacts, such as how cyber coverage protects families’ finances and helps keep their important information safe.
Two common misunderstandings slow adoption. Some believe they can avoid cyber risks just by being careful online, but many breaches happen through third parties like hospitals or airlines. Others think cyber insurance only covers hacking, but personal cyber policies can also protect against scams where people are tricked into giving away money or information.
Unlike identity theft coverage, which often covers some expenses related to stolen identity, personal cyber insurance can cover broader financial losses and connect people with experts to handle attacks.
So far, most buyers have been high-net-worth individuals, partly because they often work with financial advisors who explain the value. However, personal cyber insurance is becoming available in standard markets too. Entry-level plans can start at about $100 a year, with more extensive coverage costing more, allowing people to pick what fits their budget.
Araujo also notes that personal cyber insurance fills a gap between what businesses cover and the personal impact of cyber incidents. Even when companies address data breaches, affected individuals still face consequences. Personal insurance helps protect people in those situations.
As digital life becomes a daily reality, the need for personal cyber coverage grows. It’s clear that cyber risks don’t just threaten businesses—they can touch anyone, anytime.