Cyber Crime Junkies
Cyber Crime Junkies

How Business Can Transfer Cyber Risk

April 1, 2026

AI Summary

5 min read

In this episode of Cyber Crime Junkies, hosts David Morrow and Logan Potberg talk with Jeff Severino and Nathan Borgart from Locked in Affinity, a unit of Lockton focused on cyber insurance for small and mid-sized businesses. The guests outline how insurance transfers financial and operational risks from cyberattacks, emphasizing preparation through low- or no-cost steps regardless of coverage. They draw from claims data and real client stories to explain defenses, common breaches, and policy pitfalls.

Risk Transfer as Core Function

Cyber insurance primarily shifts unpredictable costs from a business to an insurer, covering top claims like extortion (ransomware, the leading payout area), social engineering fraud (funds transfers), and data breaches via email or system access. Guests stress it's not a full security solution but a safety net for scenarios like system shutdowns, where businesses face payroll, utilities, legal notifications, and potential ransoms in Bitcoin (often $200,000 to $1 million). Forensics alone averages $10,000 without ransom, rising to six figures with it; remediation and negotiators add more. They recount a skeptical business owner who saw the value after understanding these exposures, noting insurance activates via a single 800-number for IT, legal, and crisis support.

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What you'll learn

  • 1 (02:45) **Guests Introduction** - Hosts welcome Nathan Borgart and Jeff Severino from Locked in Affinity, experts in small business cyber insurance.
  • 2 (04:05) **Origin Story** - Brokers discover cyber insurance need via small law firm malpractice clients.
  • 3 (06:53) **What Cyber Insurance Covers** - Core coverages ranked like college football: extortion #1, social engineering #2, then breaches.
  • 4 (08:23) **12 Low/No-Cost Defenses** - Claims data analysis yields 12 root-cause fixes for small businesses.
  • 5 (09:00) **Breach Response Step 1: IT Contact** - Identify trusted IT provider before shutdown for immediate mitigation.
  • 6 (10:57) **Breach Response Step 2: Legal Counsel** - Pre-select attorney for notifications, HIPAA, credit monitoring duties.
  • 7 (12:15) **Financial Breach Costs** - Account for downtime payroll, ops, potential ransom (e.g., $200K-$1M Bitcoin).

+ Full timestamped outline available in the app

Show Notes

In this conversation, Jeff Severino and Nathan Borghardt discuss the importance of cyber insurance for small businesses. They share their background and approach to cyber insurance, emphasizing the need for risk transfer. They highlight 12 low-cost measures that small businesses can implement to reduce their cyber risk. 

The conversation also explores the costs and consequences of cyber attacks, the sophistication of cyber criminals, and the future of cyber insurance. The speakers stress the importance of engaging with insurance professionals and seeking education and resources to navigate the complex cyber insurance market. They emphasize the need to align with trusted professionals and continue to expand the market for cyber insurance.

Takeaways

  • Risk Transfer is a Great Way to Approach your Cyber Planning
  • Cyber insurance is a crucial risk transfer tool for small businesses.
  • Implementing low-cost measures can significantly reduce cyber risk

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