1.Commensurate with the size and complexity of the licensee, the nature and scope of
the licensee's activities, including the licensee's use of third-party service providers,
and the sensitivity of the nonpublic information used by the licensee or in the
licensee's possession, custody, or control, each licensee shall develop, implement,
and maintain a comprehensive written information security program based on the
licensee's risk assessment that contains administrative, technical, and physical
safeguards for the protection of nonpublic information and the licensee's information
system.
2.A licensee's information security program must be designed to:
a.Protect the security and confidentiality of nonpublic information and the security
of the information system;
b.Protect against any thre
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1. Commensurate with the size and complexity of the licensee, the nature and scope of
the licensee's activities, including the licensee's use of third-party service providers,
and the sensitivity of the nonpublic information used by the licensee or in the
licensee's possession, custody, or control, each licensee shall develop, implement,
and maintain a comprehensive written information security program based on the
licensee's risk assessment that contains administrative, technical, and physical
safeguards for the protection of nonpublic information and the licensee's information
system.
2. A licensee's information security program must be designed to:
a. Protect the security and confidentiality of nonpublic information and the security
of the information system;
b. Protect against any threats or hazards to the security or integrity of nonpublic
information and the information system;
c. Protect against unauthorized access to or use of nonpublic information, and
minimize the likelihood of harm to any consumer; and
d. Define and periodically re-evaluate a schedule for retention of nonpublic
information and a mechanism for destruction if no longer needed.
3. The licensee shall:
a. Designate one or more employees, an affiliate, or an outside vendor designated
to act on behalf of the licensee which is responsible for the information security
program;
b. Identify reasonably foreseeable internal or external threats that could result in
unauthorized access, transmission, disclosure, misuse, alteration, or destruction
of nonpublic information, including the security of information systems and
nonpublic information accessible to, or held by, third-party service providers;
c. Assess the likelihood and potential damage of any threats, taking into
consideration the sensitivity of the nonpublic information;
d. Assess the sufficiency of policies, procedures, information systems, and other
safeguards in place to manage any threats, including consideration of threats in
each relevant area of the licensee's operations, including:
(1) Employee training and management;
(2) Information systems, including network and software design, as well as
information classification, governance, processing, storage, transmission,
and disposal; and
(3) Detecting, preventing, and responding to attacks, intrusions, or other
systems failures; and
e. Implement information safeguards to manage the threats identified in the
licensee's ongoing assessment and assess the effectiveness of the safeguards'
key controls, systems, and procedures on an annual basis.
4. Based on the licensee's risk assessment, the licensee shall:
a. Design the information security program to mitigate the identified risks,
commensurate with the size and complexity of the licensee, the nature and scope
of the licensee's activities, including the licensee's use of third-party service
providers, and the sensitivity of the nonpublic information used by the licensee or
in the licensee's possession, custody, or control.
b. Determine which security measures as provided under this subdivision are
appropriate and implement the security measures:
(1) Place access controls on information systems, including controls to
authenticate and permit access only to an authorized individual to protect
against the unauthorized acquisition of nonpublic information;
(2) Identify and manage the data, personnel, devices, systems, and facilities
that enable the organization to achieve business purposes in accordance
with the business' relative importance to business objectives and the
organization's risk strategy;
(3) Restrict physical access to nonpublic information only to an authorized
individual;
(4) Protect by encryption or other appropriate means, all nonpublic information
while being transmitted over an external network and all nonpublic
information stored on a laptop computer or other portable computing or
storage device or media;
(5) Adopt secure development practices for in-house developed applications
utilized by the licensee;
(6) Modify the information system in accordance with the licensee's information
security program;
(7) Utilize effective controls, which may include multi-factor authentication
procedures for employees accessing nonpublic information;
(8) Regularly test and monitor systems and procedures to detect actual and
attempted attacks on, or intrusions into, information systems;
(9) Include audit trails within the information security program designed to
detect and respond to cybersecurity events and designed to reconstruct
material financial transactions sufficient to support normal operations and
obligations of the licensee;
(10) Implement measures to protect against destruction, loss, or damage of
nonpublic information due to environmental hazards, including fire and water
damage or other catastrophes or technological failures; and
(11) Develop, implement, and maintain procedures for the secure disposal of
nonpublic information in any format.
c. Include cybersecurity risks in the licensee's enterprise risk management process.
d. Stay informed regarding emerging threats or vulnerabilities and use reasonable
security measures if sharing information relative to the character of the sharing
and the type of information shared.
e. Provide cybersecurity awareness training to the licensee's personnel which is
updated as necessary to reflect risks identified by the licensee in the risk
assessment.
5. If the licensee has a board of directors, the board or an appropriate committee of the
board at a minimum shall:
a. Require the licensee's executive management or the licensee's delegates to
develop, implement, and maintain the licensee's information security program.
b. Require the licensee's executive management or the licensee's delegates to
report the following information in writing on an annual basis:
(1) The overall status of the information security program and the licensee's
compliance with the provisions of this chapter; and
(2) Material matters related to the information security program, addressing
issues, including risk assessment, risk management and control decisions,
third-party service provider arrangements, results of testing, cybersecurity
events, or violations, and management's responses and recommendations
for changes in the information security program.
c. If executive management delegates any responsibilities under this section, the
executive management delegates shall oversee the development,
implementation, and maintenance of the licensee's information security program
prepared by the delegate and shall receive a report from the delegate complying
with the requirements of the report to the board of directors.
6. A licensee shall exercise due diligence in selecting its third-party service provider; and
a licensee shall require a third-party service provider to implement appropriate
administrative, technical, and physical measures to protect and secure the information
systems and nonpublic information accessible to, or held by, the third-party service
provider.
7. The licensee shall monitor, evaluate, and adjust, as appropriate, the information
security program consistent with any relevant changes in technology, the sensitivity of
its nonpublic information, internal or external threats to information, and the licensee's
own changing business arrangements, including mergers and acquisitions, alliances
and joint ventures, outsourcing arrangements, and changes to information systems.
8. As part of the licensee's information security program, a licensee shall establish a
written incident response plan designed to promptly respond to, and recover from, any
cybersecurity event that compromises the confidentiality, integrity, or availability of
nonpublic information in the licensee's possession. The incident response plan must
include the licensee's plan to recover the licensee's information systems and restore
continuous functionality of any aspect of the licensee's business or operations.
9. A licensee's incident response plan must address:
(1) The internal process for responding to a cybersecurity event;
(2) The goals of the incident response plan;
(3) The definition of clear roles, responsibilities, and levels of decisionmaking
authority;
(4) External and internal communications and information sharing;
(5) Identification of requirements for the remediation of any identified
weaknesses in information systems and associated controls;
(6) Documentation and reporting regarding cybersecurity events and related
incident response activities; and
(7) The evaluation and revision as necessary of the incident response plan
following a cybersecurity event.
10. Annually, an insurer domiciled in this state shall submit to the commissioner, a written
statement by April fifteenth, certifying the insurer is in compliance with the
requirements set forth in this section. An insurer shall maintain for examination by the
department all records, schedules, and data supporting this certificate for a period of
five years. To the extent an insurer has identified areas, systems, or processes that
require material improvement, updating, or redesign, the insurer shall document the
identification and the remedial efforts planned and underway to address the areas,
systems, or processes. The documentation must be available for inspection by the
commissioner.