Running a business in Australia comes with plenty of expenses, and insurance is one cost that can quickly add up.
Most businesses pay for multiple types of insurance, from public liability and professional indemnity to workers compensation, property and cyber insurance.
While the cost of business insurance, in general, is rising and remains a concern to most Australian Businesses, there is some encouraging news. Cyber insurance premiums have reportedly been falling, and businesses with good cybersecurity practices may be able to secure even better rates on the Cyber component of their insurance policies.
Understanding what insurers look for could help you manage your insurance costs while improving the security of your business.
The Rising Cost of Business Insurance can place considerable pressure on Small and Medium Businesses in Australia
Research published by BizCover in 2026 found that 73% of insured small business owners surveyed had experienced an increase in their total business insurance premiums over the previous 12 months. Of those surveyed, 41% reported increases of at least 10%.
These findings highlight the financial pressure many business owners are experiencing.
Depending on your industry and business activities, you may need several types of insurance, including:
- Public liability insurance
- Professional indemnity insurance
- Workers compensation insurance
- Business property and contents insurance
- Commercial vehicle insurance
- Business interruption insurance
- Cyber insurance
Not every business needs every type of cover, and different types of cover can often be combined into a business insurance package.
Your total annual insurance bill is the combined cost of the policies and cover your business holds. There is no single reliable average that represents every Australian small business. Costs vary considerably depending on the business, its activities, location and level of cover.
The important question is whether you’re paying a competitive price for insurance that adequately protects your business.
Are Cyber Insurance Premiums Going Up or Down in Australia?
Despite the financial pressure associated with other rising business insurances, the cyber insurance market has become more competitive.
According to insurance broker Marsh, cyber insurance rates in the Pacific region, including Australia, decreased by 8% during the third quarter of 2026, following a 6% decrease in the previous quarter.
Increased competition between insurers has contributed to these reductions.
However, not every business will receive a lower renewal premium.
Insurers assess businesses individually, considering factors such as their industry, size, claims history, the information they hold and their cybersecurity measures.
Businesses that can demonstrate effective cybersecurity controls may be better positioned to negotiate favourable premiums, excesses and policy conditions.
Source: Marsh, Pacific Insurance Market Rates, Q3 2026. The figures reflect Marsh’s client portfolio and are not a guaranteed reduction for every Australian business.
What Are Cyber Insurers Looking for?
According to insurance broker Marsh, cyber insurance rates in the Pacific region, including Australia, decreased by 8% during the third quarter of 2026, following a 6% decrease in the previous quarter.
Increased competition between insurers has contributed to these reductions. However, not every business will receive a lower renewal premium.
Insurers assess businesses individually, considering factors such as their industry, size, claims history, the information they hold and their cybersecurity measures.
Businesses that can demonstrate effective cybersecurity controls may be better positioned to negotiate favourable premiums, excesses and policy conditions.
Source: Marsh, Pacific Insurance Market Rates, Q3 2026. The figures reflect Marsh’s client portfolio and are not a guaranteed reduction for every Australian business despite the financial pressure associated with other rising business insurances, the cyber insurance market has become more competitive.
- Multi-factor authentication on email, remote access and admin accounts. Insurers often ask this as a direct yes or no question, and a honest “no” can mean a higher premium or an exclusion.
- Regular patching of software and operating systems. Keeping computers, servers and applications updated helps address known security weaknesses that cybercriminals may exploit.
- Tested, separate backups that are not connected to the main network, so ransomware cannot encrypt them along with everything else.
- Cybersecurity monitoring and protection Security measures such as email filtering, endpoint protection and monitoring can help detect suspicious activity and reduce the potential impact of an attack.
- Staff awareness training that covers phishing and scam recognition, because human error still causes most breaches.
- A documented incident response plan showing who does what if something goes wrong.
If any of these sound unfamiliar, a good starting point is reviewing your current patch management schedule and confirming why multi-factor authentication is a must for every account that touches company data.
Six Practical Steps That Could Help Reduce Your Cyber Insurance Costs
You don’t need a large internal IT department to improve your cybersecurity.
There are practical steps businesses of all sizes can take before their next insurance renewal.
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Review your existing cybersecurity. Ask your IT provider to identify security gaps and explain what protections are already in place.
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Address important security weaknesses. Prioritise multi-factor authentication, software patching, secure backups and appropriate monitoring.
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Keep records of your security measures. Document when backups are tested, updates are completed and security reviews take place.
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Review your insurance requirements. Ask your broker which security controls may affect the premium, excess, limits or conditions offered by insurers.
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Compare insurance quotes. Ask your broker to compare suitable policies and explain differences in coverage, exclusions and pricing.
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Maintain your security improvements. Cybersecurity requires ongoing attention. Controls need to remain effective after the insurance application has been completed.
Better cybersecurity does not guarantee cheaper insurance, but it may give insurers greater confidence in how your business manages risk.
What Happens If Your Business Doesn’t Meet the Insurer’s Requirements?
Falling short of an insurer’s expectations rarely means you cannot get cover at all, but it usually costs more. Some insurers add exclusions for specific risks, such as ransomware, if a business cannot demonstrate backups are properly isolated. Others apply a higher excess or reduce the payout limit for social engineering losses, which is a common cause of claims linked to business email compromise.
In the worst case, a claim can be challenged or reduced if the insurer discovers that answers given on the application were not accurate, so it pays to be honest rather than guess. This is one more reason cyber insurance premiums rising Australia wide is pushing more businesses to tidy up their security basics before renewal.
Reviewing your policy wording alongside your actual security setup, ideally with input from both your broker and your IT provider, helps avoid unpleasant surprises at claim time. Our earlier guide on what Gold Coast businesses need from cyber insurance covers the policy side in more detail, while understanding the hidden costs of a cyber breach explains why insurers are so focused on prevention in the first place.
Why Cyber Insurance Still matters…
Even with improved cybersecurity, no business can eliminate every risk.
According to the Australian Cyber Security Centre’s Annual Cyber Threat Report 2025–26:
- More than 82,000 cybercrime reports were received in Australia, averaging one every six minutes.
- The average self-reported cost of cybercrime per report was $55,400 for small businesses.
- For medium businesses, the average was $141,300.
These figures demonstrate the potential financial consequences of cybercrime. They are reported costs, not the expected cost to every business.
Depending on the policy, cyber insurance may help cover expenses associated with investigating an attack, recovering information, business interruption and certain legal or notification costs.
However, cyber insurance should complement your security measures, not replace them.
You can read more in our guide to cyber insurance for Gold Coast businesses.
Source: Australian Cyber Security Centre, Annual Cyber Threat Report 2025–26.
How Netlogyx Can Help
For over 25 years, Netlogyx has helped Australian businesses protect their information, manage their technology and keep their teams working productively.
We can review your current cybersecurity measures, identify areas for improvement and help you understand how your existing protections compare with the controls insurers commonly assess.
We can also help you document your cybersecurity measures so you have accurate information to discuss with your insurance broker.
Want to know where your business stands?
Book a consultation with Netlogyx or call 1300 044 320.
Netlogyx provides IT and cybersecurity advice, not insurance advice. Insurance pricing, eligibility and policy recommendations should be discussed with a licensed insurance broker or insurer.
Frequently Asked Questions
Why are cyber insurance premiums rising across Australia?
Premiums are rising mainly because insurers have paid out more in claims related to ransomware, business email compromise and data breach notification costs. As claims costs rise, insurers tighten the security standards they expect before offering cover.
Can a small business still get affordable cyber insurance?
Yes. Businesses that can show basic protections are in place, such as multi-factor authentication, regular patching and tested backups, are generally better placed to secure reasonable premiums.
Do I need the full Essential Eight to qualify for cyber insurance?
Not necessarily. Most insurers focus on a handful of core practices rather than the complete Essential Eight framework, but implementing more of it generally supports a stronger application.
What happens if my application answers are not accurate?
Providing inaccurate information on a cyber insurance application can affect a claim later. If an insurer finds stated protections were not actually in place at the time of a breach, they may dispute or reduce the payout.
How often should I review my cyber insurance policy?
Reviewing your policy and your security setup together at each renewal, or at least annually, helps you catch gaps before they affect pricing or cover.