Insurance

The NAIC Insurance Data Security Model Law is a comprehensive cybersecurity framework that many states have adopted to regulate insurance companies' data security practices. It requires insurers to implement information security programs, conduct risk assessments, establish incident response plans, and oversee third-party service providers. The law applies to licensed insurers, insurance agents, and other entities licensed under state insurance laws. As of 2024, over 20 states have enacted versions of this model law. We help insurance companies determine which state regulations apply to their operations and implement compliant cybersecurity programs that meet all applicable requirements including annual certification of compliance.

Securing policyholder data in the agent and broker network requires a comprehensive third-party risk management program. This includes: establishing minimum cybersecurity requirements in agent/broker agreements, conducting security assessments of agents who handle sensitive data, providing security training and best practices to your distribution network, implementing secure data sharing methods (encrypted email, secure portals) instead of unencrypted attachments, monitoring for unauthorized data access or suspicious activity, and maintaining an inventory of which agents have access to what data. We help insurers develop vendor risk assessment programs specifically designed for the insurance distribution model, including standardized security questionnaires and risk scoring for agents, MGAs, and third-party administrators.

SOC 2 compliance is typically required for insurance companies that provide services to other organizations, such as third-party administrators (TPAs), managing general agents (MGAs), or insurance technology platforms. If you process data or provide services on behalf of other insurers or organizations, they will likely require a SOC 2 Type II report as evidence of your security controls. Even if not required by clients, SOC 2 demonstrates to state regulators, reinsurers, and business partners that you have implemented comprehensive security controls around confidentiality, availability, processing integrity, and privacy. The SOC 2 framework aligns well with insurance regulatory requirements and can satisfy multiple compliance obligations simultaneously. We help insurance organizations determine if SOC 2 is necessary for their business model and guide them through the certification process.

Insurance companies face multi-layered breach notification requirements. You must notify affected policyholders under state data breach notification laws (timing varies by state, typically 30-60 days), report to state insurance regulators as required by state insurance data security laws (often within 3 days of determination), comply with HIPAA breach notification if health insurance data is involved (60 days to policyholders, immediate to HHS if affecting 500+ individuals), and potentially notify other parties like reinsurers or business partners per contractual obligations. The specific requirements depend on what states you operate in, what type of data was compromised, and how many individuals were affected. We help insurance companies develop breach response plans that address all applicable notification requirements, including templated notifications, regulatory reporting procedures, and coordination with legal counsel and forensic investigators.

Many insurance companies operate legacy policy administration systems that cannot be easily updated or patched, creating security challenges. Best practices include: network segmentation to isolate legacy systems from modern internet-facing applications, implementing strong access controls with multi-factor authentication for all users, deploying monitoring and intrusion detection specific to legacy system traffic patterns, establishing compensating controls like database activity monitoring when system-level logging is limited, developing migration plans to move to modern platforms over time, and working with the vendor (if still supported) on security patches and updates. Even unsupported legacy systems can be secured through proper network architecture and layered security controls. We conduct specialized risk assessments of insurance technology environments that identify vulnerabilities in legacy systems and recommend practical security controls that don't require replacing critical business applications.