Earlier this 12 months, the DOL’s Worker Advantages Safety Administration issued cybersecurity steerage 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. Concerning finest practices, the DOL steerage for retirement plan cybersecurity recommends a three-pronged method:
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Suggestions for hiring a retirement plan service supplier
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Retirement plan cybersecurity finest practices
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On-line safety suggestions 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 important for advisors within the retirement plan area. 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 shield the belongings and participant information of your retirement plan shoppers? Let’s evaluation the specifics of the DOL steerage 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 correct determination for his or her plans by guaranteeing that they give attention to the next finest practices when vetting third-party distributors:
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Ask concerning the service supplier’s info safety requirements, practices, insurance policies, and audit outcomes. Your plan sponsor shoppers ought to evaluate this information with trade requirements.
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Learn the way the service supplier validates its practices and which ranges of safety requirements it has met and carried out. Right here, the main focus ought to be on contract provisions that give the shopper the correct to evaluation audit outcomes, demonstrating compliance with the usual.
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Consider the service supplier’s trade observe document. Pink flags may embody info safety incidents, litigation, or authorized proceedings associated to the seller’s providers.
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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?
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Discover out whether or not the service supplier has any insurance coverage insurance policies. Would such insurance policies cowl losses attributable to cybersecurity and identification theft breaches?
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Be sure that the service supplier contract requires ongoing compliance with cybersecurity and knowledge safety requirements. Some contract provisions might restrict the service supplier’s accountability for info safety breaches, whereas different phrases improve cybersecurity safety for the plan and its individuals, together with:
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Data safety reporting
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Provisions on the use and sharing of knowledge and confidentiality
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Notification of cybersecurity breaches
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Compliance with information retention and destruction, privateness, and knowledge safety legal guidelines
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Insurance coverage
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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. Make sure you educate your plan sponsor shoppers on the next pillars of an excellent coverage:
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Create a proper, well-documented cybersecurity program to determine and assess inner and exterior cybersecurity dangers that threaten the confidentiality, integrity, or availability of saved, nonpublic info. This system ought to:
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Pinpoint dangers
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Present needed safety
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Establish cybersecurity occasions and reply to them
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Work to revive operations and providers
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Set up sturdy safety insurance policies, pointers, and requirements.
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Conduct annual threat assessments, in addition to periodic cybersecurity consciousness coaching.
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Carry out an annual third-party audit of safety controls.
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Outline and assign info safety roles and tasks.
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Develop sturdy information entry management procedures.
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Be sure that any belongings or information saved in a cloud or managed by a third-party service supplier are topic to applicable safety critiques and impartial safety assessments.
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Implement and handle a safe methods improvement life cycle (SDLC) program (i.e., a proper approach of guaranteeing that enough safety controls are carried out).
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Have an efficient enterprise resiliency program that addresses enterprise continuity, catastrophe restoration, and incident response.
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Be sure that delicate information is encrypted whereas saved and in transit.
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Implement sturdy technical safety options and safety finest practices (e.g., frequently replace antivirus software program and again up information).
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Appropriately reply to previous cybersecurity incidents.
3) On-line safety suggestions for plan fiduciaries and individuals. Though the next suggestions is perhaps acquainted, maintaining them prime of thoughts will assist your shoppers and their plan individuals cut back the danger of fraud and loss to their retirement accounts:
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Register, arrange, and routinely monitor any on-line retirement account.
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Create sturdy and distinctive passwords.
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Use multifactor authentication.
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Hold private contact info present.
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Shut or delete unused accounts.
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Be cautious of free Wi-Fi.
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Be within the know concerning indicators of phishing assaults.
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Use antivirus software program and hold apps and software program present.
Cybersecurity Consciousness Mindset
In line with the DOL steerage 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. In the event you’re an advisor who helps or acts as a plan fiduciary, you have got an obligation to do your half in educating your shoppers concerning cybersecurity. It’s additionally an excellent enterprise follow—and a very good solution to construct relationships with retirement plan sponsors.
For extra info 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.