DOL Steering for Retirement Plan Cybersecurity

Earlier this 12 months, the DOL’s Worker Advantages Safety Administration issued cybersecurity steering for retirement plan sponsors, fiduciaries, recordkeepers, and contributors. It lays out the obligations of “accountable plan fiduciaries” to mitigate cybersecurity dangers to retirement plan property and participant knowledge. Concerning greatest practices, the DOL steering for retirement plan cybersecurity recommends a three-pronged strategy:

1. Suggestions for hiring a retirement plan service supplier

2. Retirement plan cybersecurity greatest practices

3. On-line safety ideas for plan fiduciaries and contributors

The DOL’s 3-Pronged Cybersecurity Plan

Given immediately’s heightened cybersecurity dangers, adopting a security-first mindset is important for advisors within the retirement plan house. By educating your shoppers concerning the DOL’s cybersecurity expectations, you’ll construct relationships with retirement plan sponsors and enhance the worth you present them.

How are you going to assist defend the property and participant knowledge of your retirement plan shoppers? Let’s evaluation the specifics of the DOL steering for retirement plan cybersecurity.

1) Suggestions 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 shoppers make the precise choice for his or her plans by guaranteeing that they give attention to the next greatest practices when vetting third-party distributors:

• Ask concerning the service supplier’s data safety requirements, practices, insurance policies, and audit outcomes. Your plan sponsor shoppers ought to evaluate this knowledge with trade requirements.

• Learn the way the service supplier validates its practices and which ranges of safety requirements it has met and applied. Right here, the main target needs to be on contract provisions that give the consumer the precise to evaluation audit outcomes, demonstrating compliance with the usual.

• Consider the service supplier’s trade monitor report. Pink flags would possibly embody data 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. If that’s the 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 brought on by cybersecurity and identification theft breaches?

• Make sure that the service supplier contract requires ongoing compliance with cybersecurity and knowledge safety requirements. Some contract provisions could restrict the service supplier’s accountability for data safety breaches, whereas different phrases improve cybersecurity safety for the plan and its contributors, 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 greatest practices. Creating a coverage primarily based on greatest practices will allow plan fiduciaries to behave prudently and mitigate cybersecurity threat. You should definitely educate your plan sponsor shoppers on the next pillars of a superb coverage:

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

  • Pinpoint dangers

  • Present mandatory safety

  • Determine 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 data safety roles and tasks.

• Develop robust knowledge entry management procedures.

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

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

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

• Make sure that delicate knowledge is encrypted whereas saved and in transit.

• Implement robust technical safety options and safety greatest practices (e.g., often replace antivirus software program and again up knowledge).

• Appropriately reply to previous cybersecurity incidents.

3) On-line safety ideas for plan fiduciaries and contributors. Though the next ideas is perhaps acquainted, conserving them prime of thoughts will assist your shoppers and their plan contributors 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.

• Maintain private contact data present.

• Shut or delete unused accounts.

• Be cautious of free Wi-Fi.

• Be within the know concerning indicators of phishing assaults.

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

Cybersecurity Consciousness Mindset

In line with the DOL steering 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 shoppers and their plan contributors. If you happen to’re an advisor who helps or acts as a plan fiduciary, you’ve an obligation to do your half in educating your shoppers concerning cybersecurity. It’s additionally a superb enterprise follow—and a very good option to construct relationships with retirement plan sponsors.

For extra data on cybersecurity, learn our current submit on the significance of cyber legal responsibility insurance coverage. We additionally advocate visiting the Cybersecurity Consciousness Month web site.