Cyber Liability Insurance Guide
Before signing your first agency contract, you need a cyber liability policy. This guide explains what to get, who to get it from, and what it costs.
Why This Is Required Before Your First Paid Contract
Law enforcement agencies and utilities operate under strict procurement rules. Most require vendors to carry a minimum of $1M in cyber liability coverage before signing a contract. Without it, you cannot be added to their approved vendor list — regardless of how good your technology is.
Additionally, VerifiedKnock handles officer identity data and biometric authentication. A single security incident without insurance could result in regulatory fines, class action lawsuits, and costs that would end the company.
Coverage You Need
Covers forensic investigation, breach notification letters, credit monitoring for affected individuals, and public relations costs.
Covers lost revenue if a cyberattack takes your systems offline. Critical for subscription-based businesses.
Covers claims from agencies or officers if your system fails during a critical deployment. Essential for law enforcement clients.
Covers legal defense costs for BIPA, CJIS, or state biometric law investigations. Directly relevant to VerifiedKnock's use case.
Covers claims that your software failed to perform as promised — e.g., a false negative that allowed an impersonator through.
Covers losses from phishing attacks or fraudulent wire transfers. Optional but recommended.
Recommended Providers
Start with Coalition or Cowbell — both offer instant online quotes and are well-suited for early-stage tech companies.
Coalition
RecommendedTech startups and SaaS
Instant online quote. Strong for early-stage companies. Includes active monitoring.
Get a quoteCowbell Cyber
RecommendedSMB technology companies
AI-driven underwriting. Fast approval. Good for biometric/identity tech companies.
Get a quoteChubb
Mid-market and enterprise
Best for when you land a Fortune 500 or federal agency contract. Requires broker.
Get a quoteTravelers
Established businesses
Strong brand recognition for government procurement. Requires broker.
Get a quoteWhat to Tell the Insurer
Use this description when filling out the application:
"B2B SaaS company providing NFC-based officer identity verification hardware and software to law enforcement agencies and regulated utilities. Officers carry a cryptographic NFC credential card. Biometric data (fingerprint) is stored on the card hardware only — never transmitted to or stored on our servers. We process subscription payments via Stripe. We do not access criminal justice databases or handle personally identifiable information beyond officer name, badge number, and agency contact email."
This description lowers your premium. By clarifying that biometrics stay on the card hardware (not your servers), you avoid the "biometric data processor" risk category that triggers higher rates.
Timeline to Coverage
Coalition and Cowbell both have instant online quote tools. No broker needed.
Review the policy terms, confirm coverage limits ($1M minimum), and pay the first premium.
You will receive a COI (Certificate of Insurance) PDF. This is what agencies ask for during procurement.
When an agency asks, you can add them as an additional insured on your policy. Standard for government contracts.
Pre-Contract Readiness Checklist
Complete all of these before signing your first agency contract.
Related Legal Documents
This guide is for informational purposes only and does not constitute legal or insurance advice. Consult a licensed insurance broker for coverage specific to your business.