DOL Steering for Retirement Plan Cybersecurity

Earlier this yr, the DOL’s Worker Advantages Safety Administration issued cybersecurity steerage for retirement plan sponsors, fiduciaries, recordkeepers, and members. It lays out the obligations of “accountable plan fiduciaries” to mitigate cybersecurity dangers to retirement plan property and participant information. Relating to finest practices, the DOL steerage for retirement plan cybersecurity recommends a three-pronged strategy:

1. Ideas for hiring a retirement plan service supplier

2. Retirement plan cybersecurity finest practices

3. On-line safety suggestions for plan fiduciaries and members

The DOL’s 3-Pronged Cybersecurity Plan

Given as we speak’s heightened cybersecurity dangers, adopting a security-first mindset is important for advisors within the retirement plan area. By educating your purchasers concerning the DOL’s cybersecurity expectations, you’ll construct relationships with retirement plan sponsors and improve the worth you present them.

How are you going to assist defend the property and participant information of your retirement plan purchasers? Let’s evaluate the specifics of the DOL steerage for retirement plan cybersecurity.

1) Ideas for hiring a retirement plan service supplier. Many (if not most) plan sponsors depend on third-party service suppliers for help with plan administration and recordkeeping. You possibly can assist purchasers make the appropriate resolution for his or her plans by guaranteeing that they deal with the next finest practices when vetting third-party distributors:

• Ask concerning the service supplier’s info safety requirements, practices, insurance policies, and audit outcomes. Your plan sponsor purchasers ought to examine this information with business requirements.

• Find out how the service supplier validates its practices and which ranges of safety requirements it has met and applied. Right here, the main target must be on contract provisions that give the consumer the appropriate to evaluate audit outcomes, demonstrating compliance with the usual.

• Consider the service supplier’s business monitor report. Purple flags may embody info safety incidents, litigation, or authorized proceedings associated to the seller’s providers.

• Focus on whether or not the service supplier has skilled previous safety breaches. In that case, what occurred? How did the service supplier reply?

• Discover out whether or not the service supplier has any insurance coverage insurance policies. Would such insurance policies cowl losses attributable to cybersecurity and id theft breaches?

• Be sure that the service supplier contract requires ongoing compliance with cybersecurity and knowledge safety requirements. Some contract provisions could restrict the service supplier’s duty for info safety breaches, whereas different phrases improve cybersecurity safety for the plan and its members, together with:

  • Data safety reporting

  • Provisions on the use and sharing of knowledge and confidentiality

  • Notification of cybersecurity breaches

  • Compliance with data retention and destruction, privateness, and knowledge safety legal guidelines

  • Insurance coverage

2) Retirement plan cybersecurity finest practices. Creating a coverage primarily based on finest practices will allow plan fiduciaries to behave prudently and mitigate cybersecurity threat. Remember to educate your plan sponsor purchasers on the next pillars of a great coverage:

• Create a proper, well-documented cybersecurity program to determine and assess inside and exterior cybersecurity dangers that threaten the confidentiality, integrity, or availability of saved, nonpublic info. This system ought to:

  • Pinpoint dangers

  • Present obligatory safety

  • Establish cybersecurity occasions and reply to them

  • Work to revive operations and providers

• Set up robust safety insurance policies, pointers, and requirements.

• Conduct annual threat assessments, in addition to periodic cybersecurity consciousness coaching.

• Carry out an annual third-party audit of safety controls.

• Outline and assign info safety roles and tasks.

• Develop robust information entry management procedures.

• Be sure that any property or information saved in a cloud or managed by a third-party service supplier are topic to applicable safety evaluations and impartial safety assessments.

• Implement and handle a safe programs growth life cycle (SDLC) program (i.e., a proper approach of guaranteeing that satisfactory safety controls are applied).

• Have an efficient enterprise resiliency program that addresses enterprise continuity, catastrophe restoration, and incident response.

• Be sure that delicate information is encrypted whereas saved and in transit.

• Implement robust technical safety options and safety finest practices (e.g., frequently replace antivirus software program and again up information).

• Appropriately reply to previous cybersecurity incidents.

3) On-line safety suggestions for plan fiduciaries and members. Though the next suggestions may be acquainted, retaining them high of thoughts will assist your purchasers and their plan members cut back the danger of fraud and loss to their retirement accounts:

• Register, arrange, and routinely monitor any on-line retirement account.

• Create robust and distinctive passwords.

• Use multifactor authentication.

• Preserve private contact info present.

• Shut or delete unused accounts.

• Be cautious of free Wi-Fi.

• Be within the know relating to indicators of phishing assaults.

• Use antivirus software program and maintain apps and software program present.

Cybersecurity Consciousness Mindset

In response to the DOL steerage for retirement plan cybersecurity, the insurance policies described above are designed to assist defend an estimated $9.3 trillion in plan property. This huge sum highlights the cyberthreats confronted by your plan sponsor purchasers and their plan members. In case you’re an advisor who helps or acts as a plan fiduciary, you will have an obligation to do your half in educating your purchasers relating to cybersecurity. It’s additionally a great enterprise observe—and a very good option to construct relationships with retirement plan sponsors.

For extra info on cybersecurity, learn our latest put up on the significance of cyber legal responsibility insurance coverage. We additionally advocate visiting the Cybersecurity Consciousness Month web site.