The gap between what clubss think they have and what insurers will actually pay

By Dan Weedin, Emerging Risk Solutions®

June 8, 2026

Your phone rings at 6:30 on a Tuesday morning. As the General Manager of a private club, you’re used to early calls — a grounds crew issue, a member complaint, a kitchen emergency. But this call is different.

Your club has been held up.

Unlike the days of Jesse James or Bonnie and Clyde, getting “held up” now happens in the shadows of cyberspace. And it’s not a lone hacker in a basement. It’s a sophisticated, efficient criminal organization that has kidnapped your technology and is holding it for ransom — your tee sheet system, member billing, payroll, reservation platform, point of sale terminals in the pro shop and restaurant.

But there’s good news! You have cyber insurance.

But wait, there’s bad news. Your cyber insurance policy has a $100,000 sublimit for ransomware payments. The demand is $800,000. Nobody explained the sublimit.

What Is Ransomware?

Ransomware is the colloquial name for cyber extortion. This distinction matters because insurance carriers use both terms when detailing coverages and sublimits in a cyber policy, and if you don’t know to look for both, you can miss critical limitations.

In simple terms: a ransomware attack locks down your club’s systems and data. You cannot access anything until you pay a ransom, typically demanded in cryptocurrency. For a private club, that means no member records, no billing, no tee times, no event management, and no payroll. Your entire operation grinds to a halt.

Why This Matters for Private Clubs

You may be thinking: “We’re a private club — not a bank. Why would cybercriminals target us?” The answer is straightforward.

• Private clubs hold high-value member data: credit card numbers, home addresses, Social Security numbers for payroll, and banking information for dues billing.
• Clubs are operationally dependent on technology. A multi-day outage during a major tournament or busy season isn’t just an inconvenience, it’s a reputational crisis and a financial hit.
• Many clubs operate with lean administrative staffs and have less robust cybersecurity infrastructure than large corporations making them attractive, softer targets.
• Cybercriminals know that club leadership — boards, GMs, and treasurers — are focused on member experience, not cyber risk. That creates an opening.

IBM’s 2025 Cost of a Data Breach Report puts the average total cost of a ransomware breach at $5.08 million — the highest of any attack vector tracked. Ransomware payments across a recent three-year window exceeded $2.1 billion, more than the entire prior nine-year period combined. Clubs are not immune.

Five Insurance Issues Every GM Must Understand

1. Ransomware coverage lives only in your cyber policy.

Your club likely carries multiple insurance policies: General Liability, Property, Umbrella, Employment Practices, and possibly a Crime bond. None of those cover a ransomware attack. Ransomware — also called cyber extortion — is a first-party cyber claim, covered exclusively within the cyber liability policy. If you don’t have one, you have no coverage. If you do have one, the details matter enormously.

2. Sublimits are the fine print that can devastate you.

Your cyber policy may carry a $1 million or $2 million limit. That sounds reassuring. But buried in the policy is a sublimit specifically for ransomware, often $100,000, regardless of the main limit. If a criminal demands $800,000, your policy pays $100,000. You cover the rest. That gap could be existential for a club operating on tight margins or facing a disbelieving board.

3. Nobody reads the policy — including, probably, you.

The insurance proposal you reviewed at renewal is a summary — it is not the policy. Sublimits are usually present in proposals, but they are easy to overlook. They are spelled out clearly inside the actual policy document. The problem is that nobody reads it. As GM, your job is running the club. But when a $700,000 gap appears at the worst possible moment, “I didn’t know to look for that” doesn’t close the hole.

4. Multi-Factor Authentication (MFA) is now a coverage condition.

Most cyber insurers now require MFA as a condition of coverage. If your club doesn’t have it in place, a carrier can deny your claim or non-renew your policy. Don’t assume your IT vendor or insurance broker has confirmed compliance. Verify it yourself and document that verification.

5. Third-party and vendor attacks may not be covered.

Clubs rely on dozens of vendors: tee sheet software, POS systems, payroll processors, event management platforms. If a ransomware attack enters your environment through one of those vendors, many cyber policies have no coverage “trigger” because the attack didn’t originate on your network. Does your policy respond to a third-party breach? You need to know the answer before you need it.

What’s Your Ransomware Sublimit?

Here is the question you should be able to answer right now: What is the ransomware sublimit on your current cyber policy?

If you don’t know, you’re not alone — but that’s precisely the problem. When was the last time you reviewed those sublimits? Hopefully at your last renewal. But did you take the extra step of reading the policy itself to confirm? The insurance sales proposal is only a summary. It is not intended to replace the policy.

This is not a criticism of your broker. Brokers present what they present. The gap is in assuming that a proposal review equals a policy review. It does not.

The Bottom Line

The cybersecurity threat landscape has evolved far faster than most private clubs’ insurance programs. Cybercriminals continue to outpace the “good guys” in sophistication, speed, and targeting.

As GM, managing insurance is not your primary job — running an exceptional club is. That’s exactly why an independent, unbiased review of your insurance program matters. Not a review by the broker who sold you the policy. An independent review, designed to identify the gaps before a criminal does.

Your members trust you to protect their club, their data, and their investment. Knowing what your cyber policy actually covers — and what it doesn’t — is part of that obligation.

Not sure where your club stands? Schedule a call with Dan and find out what your policy covers – before you need to.

© 2026 Dan Weedin. All Rights Reserved