Ransomware Coverage Reality Calculator
A headline policy limit is not what a ransomware claim actually pays. A sublimit, coinsurance, a waiting period, your retention and the aggregate cap all chip away at it. Enter your policy terms and a modelled incident to see limit vs likely recovery — and the gap you would self-fund. Every figure is yours; this is a transparent arithmetic model, not insurance advice, and real policies vary in wording and order of application.
What this calculator does
- A headline policy limit is not what a ransomware claim pays — a sublimit, coinsurance, a waiting period, your retention and the aggregate cap all reduce it.
- Enter your own policy terms and a modelled incident (ransom, business-interruption loss, outage hours, response costs) and see limit vs likely recovery, plus the gap you self-fund.
- Transparent arithmetic you can follow line by line — every figure is yours; nothing is fabricated and nothing is uploaded.
- Illustrative model, not insurance advice; real policies vary in wording and the order terms apply.
Why this matters
Boards approve a cyber-insurance limit as if it were the amount they will receive after a bad day. It almost never is. Ransomware is the loss most shaped by the fine print — extortion sublimits and coinsurance were added specifically because carriers were paying out so much on it — so the gap between the headline limit and the real recovery is widest exactly where it hurts most.
This calculator makes that gap concrete using your own policy terms, so you can buy to the recovery you need rather than a number on the declarations page. It is a transparent model, not insurance advice; confirm your wording and the order terms apply with your broker, and never model a ransom payment without first confirming it is lawful.
Frequently asked questions
Why is a ransomware payout less than the policy limit?
Several policy mechanics stack. A ransomware or cyber-extortion sublimit caps the extortion payout below the full aggregate limit (e.g. a $2m policy with a $500k extortion sublimit). Coinsurance makes you share a percentage of the extortion loss. A business-interruption waiting period (often 8–12 hours) means no BI is paid for the first part of an outage. Your per-claim retention comes off the top. And the aggregate limit caps everything combined. Each is reasonable on its own; together they can turn a seven-figure limit into a recovery that covers well under half the loss. This calculator applies them in order so you can see where the money goes.
What is coinsurance on cyber extortion?
Coinsurance is a contractual share of a loss that you retain even after the retention is met. On cyber-extortion cover it is increasingly common to see 20–50% coinsurance, meaning the insurer pays 80–50% of the covered extortion amount and you pay the rest. It exists to keep the insured financially invested in resisting and preventing extortion. It is distinct from the deductible and applies on top of it, so a high coinsurance can quietly remove a large slice of a ransomware payout.
What is a business-interruption waiting period?
A waiting period (or time retention) is the number of hours an outage must last before business-interruption cover begins — commonly 8, 10 or 12 hours. If your outage is shorter than the waiting period, no BI is paid at all; if it is longer, only the portion beyond the waiting period is typically covered. It is the time-based equivalent of a deductible, and it is why two companies with the same BI limit can recover very differently depending on how long their outage ran. Confirm your own policy’s hours and how it measures them.
Are these numbers real?
No — every figure in the calculator is one you enter, and the example values are just a starting point to edit. The tool does not assert any market rates or loss figures; it only does transparent arithmetic on your inputs to show how your policy’s own terms reduce a headline limit to a likely recovery. It is an educational model, not insurance advice, and real policies differ in definitions and the order in which sublimits, coinsurance, waiting periods and retentions apply — read your wording and confirm with your broker.
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