DOL Steerage 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 individuals. It lays out the obligations of “accountable plan fiduciaries” to mitigate cybersecurity dangers to retirement plan belongings and participant information. Relating to 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 individuals

The DOL’s 3-Pronged Cybersecurity Plan

Given at this time’s heightened cybersecurity dangers, adopting a security-first mindset is crucial for advisors within the retirement plan area. By educating your shoppers in regards to the DOL’s cybersecurity expectations, you’ll construct relationships with retirement plan sponsors and improve the worth you present them.

How will you assist shield the belongings and participant information of your retirement plan shoppers? Let’s assessment 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’ll be able to assist shoppers make the precise determination for his or her plans by making certain that they give attention to the next greatest practices when vetting third-party distributors:

• Ask in regards to the service supplier’s data safety requirements, practices, insurance policies, and audit outcomes. Your plan sponsor shoppers ought to evaluate this information 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 ought to be on contract provisions that give the shopper the precise to assessment audit outcomes, demonstrating compliance with the usual.

• Consider the service supplier’s trade observe report. Purple flags would possibly embrace data safety incidents, litigation, or authorized proceedings associated to the seller’s providers.

• Talk about 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 brought on by cybersecurity and id theft breaches?

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

  • Data safety reporting

  • Provisions on the use and sharing of data and confidentiality

  • Notification of cybersecurity breaches

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

  • Insurance coverage

2) Retirement plan cybersecurity greatest practices. Creating a coverage based mostly on greatest practices will allow plan fiduciaries to behave prudently and mitigate cybersecurity danger. You should definitely educate your plan sponsor shoppers on the next pillars of an excellent coverage:

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

  • Pinpoint dangers

  • Present obligatory safety

  • Establish cybersecurity occasions and reply to them

  • Work to revive operations and providers

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

• Conduct annual danger 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 obligations.

• Develop sturdy information entry management procedures.

• Be certain that any belongings or information saved in a cloud or managed by a third-party service supplier are topic to acceptable safety critiques and impartial safety assessments.

• Implement and handle a safe methods improvement life cycle (SDLC) program (i.e., a proper approach of making certain that ample safety controls are applied).

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

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

• Implement sturdy technical safety options and safety greatest practices (e.g., recurrently replace antivirus software program and again up information).

• Appropriately reply to previous cybersecurity incidents.

3) On-line safety ideas for plan fiduciaries and individuals. Though the next ideas is likely to be acquainted, holding them prime of thoughts will assist your shoppers and their plan individuals scale back the danger of fraud and loss to their retirement accounts:

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

• Create sturdy 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 relating to indicators of phishing assaults.

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

Cybersecurity Consciousness Mindset

In keeping with the DOL steering for retirement plan cybersecurity, the insurance policies described above are designed to assist shield an estimated $9.3 trillion in plan belongings. This huge sum highlights the cyberthreats confronted by your plan sponsor shoppers and their plan individuals. For those who’re an advisor who helps or acts as a plan fiduciary, you could have an obligation to do your half in educating your shoppers relating to cybersecurity. It’s additionally an excellent enterprise follow—and a very good approach to construct relationships with retirement plan sponsors.

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