What Your Cyber Insurance Doesn’t Cover and What to Do About It

The Coverage Illusion: When Insurance Isn’t Enough

Cybersecurity services Dallas businesses rely on can help reduce risk—but many still lean too heavily on cyber insurance, assuming it covers every possible threat. Many Dallas businesses assume their policy will fully protect them when a breach occurs, only to discover key exclusions when they need coverage most.

In 2024, as threat actors become faster and more complex, policy limitations are surfacing in more incidents—from ransomware and data theft to regulatory fines and business disruption. Yet these gaps are rarely obvious until after the fact. So how can you be confident that your business is truly covered?

False Confidence in Your Policy

Cyber insurance can feel like a safety net—but it often doesn’t cover what matters most. According to SecurityWeek’s Cyber Insights 2025, fewer than half of U.S. small and mid-sized businesses carry cyber insurance, despite facing rising threats.¹ And for those that do, critical exclusions—like third-party breaches, employee error, or failure to meet security requirements—can lead to denied claims when support is needed most.

That gap between expectation and reality leaves many businesses vulnerable. As insurers respond to growing losses with stricter policies and narrower coverage, understanding your policy’s limits is just as important as having one.

Here are the most common gaps:

➤ Third-Party Vendor Incidents

If your breach stems from a partner, supplier, or software vendor, your coverage might not apply—especially if you don’t have contractual protections or an endorsed policy.

➤ Reputational Damage

While your policy may help with breach recovery, it likely won’t cover the cost of rebuilding trust, managing public relations, or retaining customers after the fact.

➤ Business Email Compromise

Scams that trick employees into transferring funds or credentials—often using deepfake audio or lookalike emails—are a growing threat. But many policies limit or deny coverage for these.

➤ Regulatory Fines and Legal Fees

Penalties from data privacy violations or compliance failures may be excluded, especially if the breach stems from unpatched systems or lack of security protocols.

➤ Security Gaps That Void Claims

Some insurers deny claims if your business didn’t meet baseline standards like multi-factor authentication (MFA), endpoint detection, or a formal response plan.

How Pegasus Delivers Cybersecurity Services That Dallas Businesses Can Count On

At Pegasus Technology Solutions, we help you go beyond the policy—to build a proactive, resilient foundation that stands even when your insurance doesn’t.

Here’s how we support your strategy:

Policy-Aware Risk Assessments

Understanding your policy starts with translating legal language into real-world impact. We review your cyber insurance documentation with you—not as legal advisors, but as your dedicated technology partner. Our team highlights technical requirements, uncovers hidden exclusions, and helps you spot areas where coverage may be limited or conditional. Then we conduct a full cybersecurity risk assessment to map those findings to your actual environment—identifying where the biggest exposure lives and what needs to be addressed before you ever have to file a claim.

Security Controls That Strengthen, and Support, Your Policy

Cyber insurers often require that businesses adhere to baseline security measures to maintain eligibility. But few organizations have clarity on what those standards include—or how to prove they’ve been met. Pegasus helps close that gap with tailored implementation of controls such as multi-factor authentication (MFA), endpoint detection and response (EDR), email filtering, and robust backup systems. We don’t just help you meet insurer expectations—we position your environment to withstand real threats, reduce premiums, and avoid claims altogether.

Vendor Risk Management

Many policies exclude liability for breaches that originate with third-party vendors. That’s why we help you assess, segment, and manage external partnerships through a comprehensive risk framework. This includes vendor assessments, due diligence checklists, and tiered access models that limit what partners can access and how. We also help you develop security requirements within your vendor contracts—so accountability doesn’t end at your network’s edge.

Incident Response Readiness

When a cybersecurity incident happens, speed and preparation are everything—especially when insurance timelines and evidence requirements come into play. Pegasus works with your internal team to build a detailed, actionable incident response plan. We test that plan through tabletop exercises, help you establish escalation protocols, and provide support during real-world incidents. Our goal: to minimize the damage, reduce downtime, and preserve the forensic trail needed to support your claim (if it comes to that).

Training That Strengthens Cybersecurity Services Dallas Teams Trust

A significant number of cyber insurance claims are denied due to employee negligence or preventable mistakes. That’s why we believe in empowering your people as part of your first line of defense. Our tailored security awareness programs go beyond one-time presentations—we deliver real-world simulations, phishing campaigns, and behavior-based training to build muscle memory and decision-making confidence across your organization. The result: fewer missteps, stronger habits, and a smarter culture of security from the inside out.

Securing What Insurance Can’t

Cyber insurance is a smart investment—but it’s not a silver bullet. When a breach happens, your response, preparation, and internal defenses matter just as much as the policy itself.

Pegasus Technology Solutions helps you bridge the gap between policy limitations and operational resilience. With clear risk visibility, security controls that support coverage, and a team that understands both the tech and the fine print, you can take a proactive stance that doesn’t wait for a claim to tell you what went wrong.

Cyber insurance isn’t your defense—it’s your backup. Let’s work together to strengthen the front lines.