Navigate the Dangerous Waters of Insurance Industry Regulations

Navigate the Dangerous Waters of Insurance Industry Regulations

As more insurance companies move to the Cloud, their detailed customer information becomes increasingly distributed, making them a prime target for cybercriminals. As a growing insurance company, data breaches by hackers or human error can jeopardize your credibility, put you at risk for a lawsuit and even put you out of business.

Given the concerns about cybersecurity, the National Association of Insurance Commissioners (NAIC), which is the U.S. standard-setting and regulatory support organization, established the “Insurance Data Security Model Law.” This model adopts the risk assessment-based approach that was first identified by the New York Department of Financial Services (DFS).

While the NAIC does not set state regulations, it will likely be adopted in most states and therefore be relevant to your business. The recommended provisions are based around security and address everything from cyber-attack vulnerability to staff training. Five key provisions are identified below:

  1. Information Security Program – Develop a comprehensive document that describes the safeguards for protecting customer information and your IT system, including a cyberattack response plan.
  2. Cybersecurity Risk Assessment – Perform a risk assessment that identifies current vulnerabilities, threat sources and recommended counter measures to mitigate those risks.
  3. Qualified and Trained Personnel – Designate a specific person to be responsible for cybersecurity and implement awareness training for all personnel.
  4. Encryption – Secure customer data transmitted over a public network and stored on laptops and other mobile devices through encryption and multifactor authentication.
  5. Annual Certification of Compliance – File an annual certification confirming compliance.

These requirements involve considerable planning, budgeting and expertise, which can be a heavy burden for many small businesses. At ICS, our expertise lies in working with insurance companies to safeguard clients’ data and meet or exceed the industry regulations in order for you to breeze through your next compliance audit.

We complete a thorough review of your IT environment and policies to identify gaps in order to implement steps to strengthen your systems so that your business is compliant with the required regulations. We do this through the following actions:

  1. Risk Assessment Implementation – We identify IT vulnerabilities, their impact, the likelihood of occurrence and what steps to take to mitigate that risk.
  2. Network Security – We implement an in-depth defense strategy that includes multiple security layers both for the network and the users.
  3. Security Policy Preparation – We develop your Information Security Program that is in line with the regulations with the appropriate amount of security solutions customized for your business.
  4. Team Training – We provide security training to your employees to ensure that they are using the appropriate security precautions when accessing customer data.

Navigating the waters of insurance industry regulations can be complicated and time consuming. And without an experienced partner, you run the risk of not passing an audit. Contact ICS today to help your business understand these regulatory requirements and prepare to breeze through your next compliance audit.