Does Cyber Insurance Cover Lost Data?

“Lost data” can mean the cost of reconstructing files, the value of information that cannot be recreated, or revenue lost because the data is unavailable. These are different losses. FTC guidance identifies recovery or replacement of lost or stolen data as a typical cyber coverage area, while the Insurance Information Institute notes that lost revenue associated with intellectual-property theft may be outside standard cyber coverage. Neither establishes payment for every data asset.

Check whether the policy covers the specific cause of loss, such as a security event, accidental deletion, corruption, or system failure. Look at definitions of data and digital assets, valuation rules, exclusions for intellectual property, and any recovery sublimit. Ask whether the contract pays reasonable restoration expense or a broader economic value. Preserve backups and evidence, and confirm approval requirements before engaging a recovery vendor.