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Privacy and Security Risks in a Digital Age Risk Management Strategies January 26, 2009 professional  underwriters, inc .
Overview ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Data Breach Focal Points Organizations continue to face mounting consequences with their lack of protection of private data. Unauthorized Disclosure or Breach of  Your PII Personally Identifiable Information Credit Card or Bank Account Numbers Social Security Numbers Customer Records Protected Health Information Laptop Theft Backup  Tape Theft Wireless Access  Breach E-Commerce Breach Rogue Employees Data  Leakage Hacks  & Viruses Vendors/ Outsourcing
A Sectoral Approach… National Security Corporate IT  Governance Health Care Payment  Cards Consumer  Protection Financial Services Infrastructure Protection Other Higher  Education
… Created Numerous Laws, Regulations and Standards… Int’l Law State Law SOX FTCA ,[object Object],[object Object],[object Object],[object Object],[object Object],FISMA HIPAA GLBA
…Which has Led to  Compliance “Silos”
Creating Inefficiencies and other Problems for Our Clients ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],FTCA  Consultants PCI Consultants Int’l Consultants State Law Consultants
Managing Information Risks Avoid Mitigate Control Transfer Assume RISK
Response: A Unified Approach to  Information Security Compliance Includes Insurance  Coverage Addresses  all of the legal  requirements:  Security, Privacy  and Identity  Theft Uses popular  standards and  compliance  frameworks Risk Assumption, Mitigation and Control Risk Transfer Comprehensive Risk Management Program
Possibly Applicable Laws  ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
State Laws ,[object Object],[object Object]
State Notice of Breach Laws ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Most require businesses  and/or government to notify state  residents if their computerized “personal  information” is involved  in a data breach ,[object Object],[object Object],[object Object],[object Object],[object Object]
State Data Security Laws ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Massachusetts:  Compliance Program Elements  ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Massachusetts:  Safeguards ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],- Secure user authentication protocols; - Secure access, providing access to only to those require information to perform their job duties; assign unique ID and passwords to each person; - Encrypt records containing PI transmitted over the Internet, transmitted wirelessly, or are stored on laptops or other portable devices; - Monitor systems for unauthorized access or use; and -  Keep current firewall protection, operating system security patches for systems connected to the Internet, and malware/virus software. - Implement reasonable restrictions on physical access to records; and - storage of records containing PI and  data in locked facilities, storage areas or containers. Physical Administrative Technical
State Disposal Rules ,[object Object],[object Object],[object Object]
SOX and Security ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
FTC Authority ,[object Object],[object Object],[object Object]
FTC Security Enforcement Based on notice of privacy practices and official statements regarding how an organization safeguards sensitive information. (e.g.,  In re Guidance Software Inc. Deceptive Trade  Practices Unfair Trade  Practices Practices that "threaten data security“ are unfair practices. (e.g.,  In re BJ’s Wholesale Club )  GLBA Safeguards Violations of Safeguards Rule, (e.g.,  In re Superior Mortgage Corp. )
Recent Enforcement/Consent Orders - FTCA ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Total of 18 Cases
FTC Consent Orders and Security ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Implement administrative, technical, and physical safeguards appropriate to the size, the nature of the company’s activities, and the sensitivity of the personal information collected by each organization. ,[object Object],[object Object],Must be performed by a CISSP or equivalent
International Laws ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Inadequacy of U.S. Protections ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Unified Approach To Security      Security Awareness and Training       Contracts X X    Review/Evaluation      Contingency Planning      Security Incident Procedures       Management of Information Access       Workforce Security       Assigned Security Responsibility       Security Management Process  Administrative Safeguards State FTCA  PCI DSS NIST FIPS ISO 27002 Security Practices
Unified Approach to Security      Transmission Security      Person or Entity Authentication      Integrity Controls      Audit Controls      Access Control Technical Safeguards      Device and Media Controls       Workstation Use and Security      Facility Access Controls Physical Safeguards State FTCA PCI DSS  NIST FIPS ISO 27002 Security Practice
Consider all of Your Security and Privacy Compliance Requirements  SOX FTCA State International PCI DSS ISO FTCA (CO) COBIT COSO OECD AICPA PCI 1.2 Follow a  UNIFIED APPROACH  to Compliance
Part 2 Risk Transfer: A Valuable Tool for Risk Management Avoid Mitigate Control Transfer Assume RISK Transfer
Data Breach Focal Points Organizations continue to face mounting consequences with their lack of protection of private data. Unauthorized Disclosure or Breach of  Your PII Personally Identifiable Information Credit Card or Bank Account Numbers Social Security Numbers Customer Records Protected Health Information Laptop Theft Backup  Tape Theft Wireless Access  Breach E-Commerce Breach Rogue Employees Data  Leakage Hacks  & Viruses Vendors/ Outsourcing
Risk Transfer One risk management tactic is risk transfer.  ,[object Object],[object Object],[object Object],Protects you from attacks on your network Pays for costs associated with public relations damage control Protects you from threats of attack on your network Media Covers libel, slander, unfair trade practices via organization website or electronic media Network Security Covers liability caused by breach of network (e.g. hack or viruses) Privacy Protects organizations from losing or compromising employee and third party data
How do the policies work? ,[object Object],[object Object],[object Object],[object Object]
Important Coverage Trends ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
The Application Process ,[object Object],[object Object],[object Object],[object Object]
Example: Darwin ,[object Object],[object Object],[object Object],[object Object]
Risk Management ,[object Object],[object Object],[object Object],[object Object],[object Object]
Darwin / Pepper Offering ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
So…How do you sell it? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Allied World/Darwin Financial Strength ,[object Object],[object Object],[object Object]
Takeaways  ,[object Object],[object Object],[object Object],[object Object]
Thank You Adam  Sills AVP, Technology Liability Underwriting (860)-284-1382 [email_address] M. Peter Adler Attorney at Law Direct:  202.220.1278 Direct Fax:  800.684.2749 [email_address] Hamilton Square 600 Fourteenth Street, N.W. Washington DC 20005-2004 202.220.1200 Fax:  202.220.1665 www.pepperlaw.com professional  underwriters, inc

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Data Risks In A Digital Age

  • 1. Privacy and Security Risks in a Digital Age Risk Management Strategies January 26, 2009 professional underwriters, inc .
  • 2.
  • 3. Data Breach Focal Points Organizations continue to face mounting consequences with their lack of protection of private data. Unauthorized Disclosure or Breach of Your PII Personally Identifiable Information Credit Card or Bank Account Numbers Social Security Numbers Customer Records Protected Health Information Laptop Theft Backup Tape Theft Wireless Access Breach E-Commerce Breach Rogue Employees Data Leakage Hacks & Viruses Vendors/ Outsourcing
  • 4. A Sectoral Approach… National Security Corporate IT Governance Health Care Payment Cards Consumer Protection Financial Services Infrastructure Protection Other Higher Education
  • 5.
  • 6. …Which has Led to Compliance “Silos”
  • 7.
  • 8. Managing Information Risks Avoid Mitigate Control Transfer Assume RISK
  • 9. Response: A Unified Approach to Information Security Compliance Includes Insurance Coverage Addresses all of the legal requirements: Security, Privacy and Identity Theft Uses popular standards and compliance frameworks Risk Assumption, Mitigation and Control Risk Transfer Comprehensive Risk Management Program
  • 10.
  • 11.
  • 12.
  • 13.
  • 14.
  • 15.
  • 16.
  • 17.
  • 18.
  • 19. FTC Security Enforcement Based on notice of privacy practices and official statements regarding how an organization safeguards sensitive information. (e.g., In re Guidance Software Inc. Deceptive Trade Practices Unfair Trade Practices Practices that "threaten data security“ are unfair practices. (e.g., In re BJ’s Wholesale Club ) GLBA Safeguards Violations of Safeguards Rule, (e.g., In re Superior Mortgage Corp. )
  • 20.
  • 21.
  • 22.
  • 23.
  • 24. Unified Approach To Security      Security Awareness and Training      Contracts X X    Review/Evaluation      Contingency Planning      Security Incident Procedures      Management of Information Access      Workforce Security      Assigned Security Responsibility      Security Management Process Administrative Safeguards State FTCA PCI DSS NIST FIPS ISO 27002 Security Practices
  • 25. Unified Approach to Security      Transmission Security      Person or Entity Authentication      Integrity Controls      Audit Controls      Access Control Technical Safeguards      Device and Media Controls      Workstation Use and Security      Facility Access Controls Physical Safeguards State FTCA PCI DSS NIST FIPS ISO 27002 Security Practice
  • 26. Consider all of Your Security and Privacy Compliance Requirements SOX FTCA State International PCI DSS ISO FTCA (CO) COBIT COSO OECD AICPA PCI 1.2 Follow a UNIFIED APPROACH to Compliance
  • 27. Part 2 Risk Transfer: A Valuable Tool for Risk Management Avoid Mitigate Control Transfer Assume RISK Transfer
  • 28. Data Breach Focal Points Organizations continue to face mounting consequences with their lack of protection of private data. Unauthorized Disclosure or Breach of Your PII Personally Identifiable Information Credit Card or Bank Account Numbers Social Security Numbers Customer Records Protected Health Information Laptop Theft Backup Tape Theft Wireless Access Breach E-Commerce Breach Rogue Employees Data Leakage Hacks & Viruses Vendors/ Outsourcing
  • 29.
  • 30.
  • 31.
  • 32.
  • 33.
  • 34.
  • 35.
  • 36.
  • 37.
  • 38.
  • 39. Thank You Adam Sills AVP, Technology Liability Underwriting (860)-284-1382 [email_address] M. Peter Adler Attorney at Law Direct: 202.220.1278 Direct Fax: 800.684.2749 [email_address] Hamilton Square 600 Fourteenth Street, N.W. Washington DC 20005-2004 202.220.1200 Fax: 202.220.1665 www.pepperlaw.com professional underwriters, inc