diff --git a/bin/lib/policies.js b/bin/lib/policies.js
index 21b1f319d98..145ad85e4d1 100644
--- a/bin/lib/policies.js
+++ b/bin/lib/policies.js
@@ -93,63 +93,40 @@ function buildPolicyGetCommand(sandboxName) {
   return `${getOpenshellCommand()} policy get --full ${shellQuote(sandboxName)} 2>/dev/null`;
 }
 
-// eslint-disable-next-line complexity
-function applyPreset(sandboxName, presetName) {
-  // Guard against truncated sandbox names — WSL can truncate hyphenated
-  // names during argument parsing, e.g. "my-assistant" → "m"
-  const isRfc1123Label = /^[a-z0-9]([a-z0-9-]*[a-z0-9])?$/.test(sandboxName);
-  if (!sandboxName || sandboxName.length > 63 || !isRfc1123Label) {
-    throw new Error(
-      `Invalid or truncated sandbox name: '${sandboxName}'. ` +
-      `Names must be 1-63 chars, lowercase alphanumeric, with optional internal hyphens.`
-    );
-  }
-
-  const presetContent = loadPreset(presetName);
-  if (!presetContent) {
-    console.error(`  Cannot load preset: ${presetName}`);
-    return false;
-  }
-
-  const presetEntries = extractPresetEntries(presetContent);
+/**
+ * Merge preset entries into existing policy YAML. Handles versionless policies
+ * by ensuring the merged result has a version header when the current policy
+ * has content but no version field. Pure function for testing.
+ *
+ * @param {string} currentPolicy - Existing policy YAML (may be versionless)
+ * @param {string} presetEntries - Indented network_policies entries from preset
+ * @returns {string} Merged YAML with version header when missing
+ */
+function mergePresetIntoPolicy(currentPolicy, presetEntries) {
   if (!presetEntries) {
-    console.error(`  Preset ${presetName} has no network_policies section.`);
-    return false;
+    return currentPolicy || "version: 1\n\nnetwork_policies:\n";
+  }
+  if (!currentPolicy) {
+    return "version: 1\n\nnetwork_policies:\n" + presetEntries;
   }
 
-  // Get current policy YAML from sandbox
-  let rawPolicy = "";
-  try {
-    rawPolicy = runCapture(
-      buildPolicyGetCommand(sandboxName),
-      { ignoreError: true }
-    );
-  } catch { /* ignored */ }
-
-  let currentPolicy = parseCurrentPolicy(rawPolicy);
-
-  // Merge: inject preset entries under the existing network_policies key
   let merged;
-  if (currentPolicy && currentPolicy.includes("network_policies:")) {
-    // Find the network_policies: line and append the new entries after it
-    // We need to insert before the next top-level key or end of file
+  if (/^network_policies\s*:/m.test(currentPolicy)) {
     const lines = currentPolicy.split("\n");
     const result = [];
     let inNetworkPolicies = false;
     let inserted = false;
 
     for (const line of lines) {
-      // Detect top-level keys (no leading whitespace, ends with colon)
       const isTopLevel = /^\S.*:/.test(line);
 
-      if (line.trim() === "network_policies:" || line.trim().startsWith("network_policies:")) {
+      if (/^network_policies\s*:/.test(line)) {
         inNetworkPolicies = true;
         result.push(line);
         continue;
       }
 
       if (inNetworkPolicies && isTopLevel && !inserted) {
-        // We hit the next top-level key — insert preset entries before it
         result.push(presetEntries);
         inserted = true;
         inNetworkPolicies = false;
@@ -158,25 +135,55 @@ function applyPreset(sandboxName, presetName) {
       result.push(line);
     }
 
-    // If network_policies was the last section, append at end
     if (inNetworkPolicies && !inserted) {
       result.push(presetEntries);
     }
 
     merged = result.join("\n");
-  } else if (currentPolicy) {
-    // No network_policies section yet — append one
-    // Ensure version field exists
-    if (!currentPolicy.includes("version:")) {
-      currentPolicy = "version: 1\n" + currentPolicy;
-    }
-    merged = currentPolicy + "\n\nnetwork_policies:\n" + presetEntries;
   } else {
-    // No current policy at all
-    merged = "version: 1\n\nnetwork_policies:\n" + presetEntries;
+    merged = currentPolicy.trimEnd() + "\n\nnetwork_policies:\n" + presetEntries;
   }
 
-  // Write temp file and apply
+  if (!merged.trimStart().startsWith("version:")) {
+    merged = "version: 1\n" + merged;
+  }
+  return merged;
+}
+function applyPreset(sandboxName, presetName) {
+  // Guard against truncated sandbox names — WSL can truncate hyphenated
+  // names during argument parsing, e.g. "my-assistant" → "m"
+  const isRfc1123Label = /^[a-z0-9]([a-z0-9-]*[a-z0-9])?$/.test(sandboxName);
+  if (!sandboxName || sandboxName.length > 63 || !isRfc1123Label) {
+    throw new Error(
+      `Invalid or truncated sandbox name: '${sandboxName}'. ` +
+      `Names must be 1-63 chars, lowercase alphanumeric, with optional internal hyphens.`
+    );
+  }
+
+  const presetContent = loadPreset(presetName);
+  if (!presetContent) {
+    console.error(`  Cannot load preset: ${presetName}`);
+    return false;
+  }
+
+  const presetEntries = extractPresetEntries(presetContent);
+  if (!presetEntries) {
+    console.error(`  Preset ${presetName} has no network_policies section.`);
+    return false;
+  }
+
+  // Get current policy YAML from sandbox
+  let rawPolicy = "";
+  try {
+    rawPolicy = runCapture(
+      buildPolicyGetCommand(sandboxName),
+      { ignoreError: true }
+    );
+  } catch { /* ignored */ }
+
+  const currentPolicy = parseCurrentPolicy(rawPolicy);
+  const merged = mergePresetIntoPolicy(currentPolicy, presetEntries);
+
   const tmpDir = fs.mkdtempSync(path.join(os.tmpdir(), "nemoclaw-policy-"));
   const tmpFile = path.join(tmpDir, "policy.yaml");
   fs.writeFileSync(tmpFile, merged, { encoding: "utf-8", mode: 0o600 });
@@ -190,7 +197,6 @@ function applyPreset(sandboxName, presetName) {
     try { fs.rmdirSync(tmpDir); } catch { /* ignored */ }
   }
 
-  // Update registry
   const sandbox = registry.getSandbox(sandboxName);
   if (sandbox) {
     const pols = sandbox.policies || [];
@@ -217,6 +223,7 @@ module.exports = {
   parseCurrentPolicy,
   buildPolicySetCommand,
   buildPolicyGetCommand,
+  mergePresetIntoPolicy,
   applyPreset,
   getAppliedPresets,
 };
diff --git a/test/policies.test.js b/test/policies.test.js
index 1671b77265c..a3050435ee9 100644
--- a/test/policies.test.js
+++ b/test/policies.test.js
@@ -136,6 +136,41 @@ describe("policies", () => {
     });
   });
 
+  describe("mergePresetIntoPolicy", () => {
+    const sampleEntries = "  - host: example.com\n    allow: true";
+
+    it("appends network_policies when current policy has content but no version header", () => {
+      const versionless = "some_key:\n  foo: bar";
+      const merged = policies.mergePresetIntoPolicy(versionless, sampleEntries);
+      expect(merged.startsWith("version: 1\n")).toBe(true);
+      expect(merged).toContain("some_key:");
+      expect(merged).toContain("network_policies:");
+      expect(merged).toContain("example.com");
+    });
+
+    it("appends preset entries when current policy has network_policies but no version", () => {
+      const versionlessWithNp =
+        "network_policies:\n  - host: existing.com\n    allow: true";
+      const merged = policies.mergePresetIntoPolicy(versionlessWithNp, sampleEntries);
+      expect(merged.trimStart().startsWith("version: 1\n")).toBe(true);
+      expect(merged).toContain("existing.com");
+      expect(merged).toContain("example.com");
+    });
+
+    it("keeps existing version when present", () => {
+      const withVersion = "version: 2\n\nnetwork_policies:\n  - host: old.com";
+      const merged = policies.mergePresetIntoPolicy(withVersion, sampleEntries);
+      expect(merged).toContain("version: 2");
+      expect(merged).toContain("example.com");
+    });
+
+    it("returns version + network_policies when current policy is empty", () => {
+      const merged = policies.mergePresetIntoPolicy("", sampleEntries);
+      expect(merged.startsWith("version: 1\n\nnetwork_policies:")).toBe(true);
+      expect(merged).toContain("example.com");
+    });
+  });
+
   describe("preset YAML schema", () => {
     it("no preset has rules at NetworkPolicyRuleDef level", () => {
       // rules must be inside endpoints, not as sibling of endpoints/binaries