Consortium of Leading Cyber Technology and Insurance Providers Announce the Launch of SafeHouseInitiative.org
January 17, 2023
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This is a companion blog to the “The SafeHouse” podcast dated March 13, 2025.
As we dive into the evolving world of cyber insurance and its critical role in protecting small and medium-sized businesses (SMBs), it’s essential to understand the journey and insights shared by industry experts like Gordon Malin, co-founder and CEO of Elpha Secure. The fusion of technology and cyber insurance is rapidly changing the landscape, and having good cyber hygiene is becoming increasingly important.
Listen to the original podcast here: https://safehouseinitiative.org/the-rise-and-importance-of-insuresec-for-smbs-with-gordon-malin-part-2/
Gordon’s story into the insurance world is fascinating. With over 20 years of experience, he began his career in consulting before a serendipitous encounter on a crowded train led him to become an insurance analyst. This unexpected turn of events brought him to the forefront of the insurance industry during a time of significant change following catastrophic events like Hurricane Katrina.
Gordon’s early experiences taught him about the insurance ecosystem’s true purpose: to support people in times of need. He witnessed firsthand the systemic risks and the chaos that ensued when companies faced unexpected losses. This pivotal moment shaped his focus on cyber risk as he observed the global digitalization trend and its implications for insurance.
Fast forward to today, and cyber insurance has evolved from a niche product to a necessity for businesses of all sizes. Gordon notes that as Main Street businesses shift from traditional brick-and-mortar setups to digital platforms, the risk landscape expands exponentially. However, alarmingly, less than 10% of small businesses currently have standalone cyber insurance policies. Gordon highlights that many SMBs operate under the misconception that they are protected under their business owner’s policy, which often provides inadequate coverage against cyber threats.
To bridge this gap, Gordon emphasizes the need for improved cyber hygiene. Simple practices such as multi-factor authentication (MFA) and regular backups can significantly reduce the risk of cyber incidents. He argues that insurance providers are beginning to mandate these controls as prerequisites for coverage. “No backups, no MFA, no insurance,” he states, illustrating how the insurance market is evolving to prioritize security measures.
As the demand for cyber insurance grows, the supply is struggling to keep pace. Gordon explains that the insurance market is on the brink of a supply-demand imbalance, which could lead to higher premiums and reduced coverage options. This situation is particularly concerning for SMBs who are just beginning to recognize their exposure to cyber risks.
According to Gordon, “Force demand is a beautiful thing,” as larger organizations often require their smaller partners to have insurance coverage as a condition of doing business. This requirement is pushing more SMBs to seek cyber insurance, but the current market may not be able to accommodate this influx.
One of the most significant challenges in the cyber insurance landscape is systemic risk — events that can impact multiple businesses simultaneously. Gordon notes that while traditional insurance models can effectively address individual, attritional losses, systemic risks present a unique challenge. The industry is now focused on understanding these risks and finding ways to manage them effectively.
Gordon introduces the concept of InsurSec, where cybersecurity measures are integrated into insurance products. By embedding security tools within insurance offerings, companies can provide SMBs with the dual benefit of coverage and essential security measures. This innovative approach aims to create a more sustainable insurance ecosystem while reducing overall risk.
As Gordon elaborates, “We began to build our own proprietary software that we could embed into the insurance product and give small businesses the coverage they need as well as the security tools they require all in one package.” This integration is a game-changer, allowing businesses to enhance their security posture while securing necessary coverage.
As we look to the future, the importance of cyber insurance and the integration of cybersecurity measures cannot be overstated. With the landscape of cyber threats continually evolving, SMBs must prioritize both cyber hygiene and insurance coverage. Gordon’s insights shed light on the pressing need for a shift in how businesses view cyber risk and the essential role of InsurSec in navigating this complex environment.
In conclusion, the journey of cyber insurance is just beginning, and for SMBs, understanding these dynamics is crucial to thriving in an increasingly digital world. Whether you’re a small business owner, IT professional, or simply curious about the future of cyber insurance, embracing these changes will be key to protecting your business from emerging threats.
For more information on the SafeHouse Initiative and to learn how you can protect your business, visit safehouseinitiative.org.
