A
Adam Bertram
Guest
Is your file transfer “policy” leaving you underinsured against data breaches? Examine the hidden vulnerabilities in insurance industry data transfers and discover how a comprehensive MFT solution can help provide the coverage you need.
“I’m sorry, but your policy doesn’t cover that type of damage.” The dreaded phrase actuaries and claims adjusters know all too well. Yet here’s the professional irony—P&C and life insurers who meticulously calculate probable maximum loss scenarios are walking around with the digital equivalent of 50/100/50 coverage when it comes to their file transfer protocols.
You wouldn’t underwrite a commercial policy with glaring exclusions for the most common loss scenarios, would you? Yet that’s precisely what many carriers have unwittingly done with their file transfer infrastructure. Those gaps in your digital security aren’t just technical debt—they’re catastrophic exclusions that could trigger a notification event under Section 17 of your cyber liability policy.
When security teams perform technical due diligence on insurers’ file transfer frameworks, they typically find extensive coverage gaps that any E&O underwriter would immediately flag as high-severity exposures. The question isn’t whether your current transfer protocols have vulnerabilities—it’s how your reinsurance treaties and captive arrangements would respond when faced with a multi-million-dollar data incident stemming from those vulnerabilities.
Just as insurance policies have terms, conditions and exclusions, your file transfer strategy has its own fine print that determines your actual protection level. Many organizations are shocked to discover they’re essentially self-insured against major risks. (And not in the good “we’ve got adequate reserves” way—more in the “oops, we forgot to budget for catastrophic data loss” way.)
The regulatory landscape for insurers is complex and unforgiving. The Gramm-Leach-Bliley Act (GLBA) mandates safeguards for customer information, and the Health Insurance Portability and Accountability Act (HIPAA) requires stringent protections for health data.
Meanwhile, common file transfer methods are full of “exclusions” that would make even your most creative policy writers blush:
Quick Win: Conduct a “coverage audit” by mapping your sensitive data flows against your transfer methods to identify your biggest exposure points.
Different insurance processes have their own unique risk profiles. Let’s examine the specific exposures hiding in each area:
Claims files contain the perfect storm of sensitive information: personally identifiable information (PII), protected health information (PHI), financial details and sometimes even photos or documentation of damages. This data flows between multiple parties—claimants, adjusters, healthcare providers, legal counsel and third-party administrators.
The risks here are substantial. Without proper controls, claims data can be:
Warning: Claims processing typically involves third-party administrators (TPAs) who handle sensitive data on your behalf. Your security is only as strong as theirs. Recent breaches have shown that third-party risk remains one of the largest exposure points for insurers.
Underwriting represents the core of your business—and contains some of your most sensitive data assets. The process involves collecting extensive applicant information including financial records, medical history, credit scores and other risk-assessment data.
This creates unique challenges:
The underwriting process often relies on secure document collection from applicants and agents. When these channels are inadequate, sensitive information can be exposed before it even enters your systems. (Think about it: you wouldn’t keep your cash in a leaky vault, so why are you keeping PII in the digital equivalent of a cardboard box?)
Moreover, underwriting processes frequently leverage legacy systems with limited security capabilities. These older systems weren’t designed for today’s threat landscape and may lack modern encryption, access controls and audit capabilities. It’s like protecting your crown jewels with a lock from 1985—quaint, but hardly effective.
Even routine communications with policyholders involve constant transmission of sensitive information. Policies, statements, notifications and customer service interactions all contain data that could expose you to risk if not properly secured.
A single compromised customer communication can trigger a notification event under various state breach laws. With the cost of breaches increasing year over year, unsecured customer communications represent a significant financial exposure.
In this area, we typically see:
When file transfer security fails, the consequences can be devastating. Recent breaches illustrate just how expensive inadequate “coverage” can be.
The financial impact of such breaches goes far beyond immediate remediation costs:
Just as comprehensive insurance protects against a wide range of perils, Progress MOVEit Managed File Transfer software helps provide the coverage your file transfers need. Unlike point solutions that address only specific aspects of security, MOVEit software helps deliver protection across your entire data exchange ecosystem.
MOVEit policy benefits include:
Protection in Transit and At Rest: Security measures that help close critical gaps in your security posture. This approach helps protect files throughout their lifecycle, from upload to share.
Tamper-Evident Audit Trails: File transactions are logged in cryptographically chained records that provide detailed evidence of who accessed what data, when and how. These audit capabilities are essential for helping to demonstrate compliance with GLBA, HIPAA and state privacy laws during regulatory examinations. Because “I don’t know who accessed our customer data” is never a good answer during an audit.
Multi-Layered Access Controls: Granular permissions, multi-factor authentication and integration with enterprise identity systems help limit sensitive information access to authorized individuals. This defense-in-depth approach helps significantly reduce the risk of unauthorized access or insider threats.
Secure Ecosystem Integration: MOVEit software facilitates secure file exchange with the entire insurance ecosystem—brokers, agents, TPAs, healthcare providers and regulatory bodies—while enabling central control and visibility. This capability is particularly valuable for helping to manage third-party risk, a critical concern for insurers.
How well is your current file transfer “policy” protecting you? Ask yourself:
If you answered “no” to any of these questions, your coverage has dangerous gaps that need to be addressed. And let’s be honest—you probably winced at least once while reading that list.
Insurance professionals understand better than most that adequate protection requires comprehensive coverage without significant exclusions. Yet many companies that expertly assess others’ risks have critical gaps in their own file transfer security.
Just as you wouldn’t recommend minimum coverage for your clients’ most valuable assets, you shouldn’t settle for partial protection of your sensitive data. MOVEit MFT helps provide the coverage your organization needs—protection that helps address the full spectrum of file transfer risks across claims processing, underwriting, customer communications and third-party exchanges.
Ready to upgrade your file transfer “policy”? Learn more about MOVEit protection and verify that your sensitive data transfers have the coverage they deserve.
Continue reading...
When Actuarial Tables Don’t Account for Digital Risk
“I’m sorry, but your policy doesn’t cover that type of damage.” The dreaded phrase actuaries and claims adjusters know all too well. Yet here’s the professional irony—P&C and life insurers who meticulously calculate probable maximum loss scenarios are walking around with the digital equivalent of 50/100/50 coverage when it comes to their file transfer protocols.
You wouldn’t underwrite a commercial policy with glaring exclusions for the most common loss scenarios, would you? Yet that’s precisely what many carriers have unwittingly done with their file transfer infrastructure. Those gaps in your digital security aren’t just technical debt—they’re catastrophic exclusions that could trigger a notification event under Section 17 of your cyber liability policy.
When security teams perform technical due diligence on insurers’ file transfer frameworks, they typically find extensive coverage gaps that any E&O underwriter would immediately flag as high-severity exposures. The question isn’t whether your current transfer protocols have vulnerabilities—it’s how your reinsurance treaties and captive arrangements would respond when faced with a multi-million-dollar data incident stemming from those vulnerabilities.
The Fine Print: Understanding Your Current ‘Coverage’ (or Lack Thereof)
Just as insurance policies have terms, conditions and exclusions, your file transfer strategy has its own fine print that determines your actual protection level. Many organizations are shocked to discover they’re essentially self-insured against major risks. (And not in the good “we’ve got adequate reserves” way—more in the “oops, we forgot to budget for catastrophic data loss” way.)
The regulatory landscape for insurers is complex and unforgiving. The Gramm-Leach-Bliley Act (GLBA) mandates safeguards for customer information, and the Health Insurance Portability and Accountability Act (HIPAA) requires stringent protections for health data.
Meanwhile, common file transfer methods are full of “exclusions” that would make even your most creative policy writers blush:
| Method | What It Claims to Cover | Actual "Policy Exclusions" |
|---|---|---|
| Email Attachments | Convenient sharing, delivery confirmation | Unencrypted transmission, easily forwarded beyond authorized recipients, limited file size |
| FTP | Simple file uploads/downloads | Credentials sent in clear text, minimal audit trails, no encryption at rest |
| Consumer Cloud Storage | Easy access, mobile capabilities | Limited enterprise controls, potential “shadow IT,” compliance gaps |
| Legacy Scripts | Custom automation, scheduling | Maintenance headaches, knowledge dependencies, security gaps |
Quick Win: Conduct a “coverage audit” by mapping your sensitive data flows against your transfer methods to identify your biggest exposure points.
Identifying Your ‘Named Perils’: Risk Exposure Across Insurance Operations
Different insurance processes have their own unique risk profiles. Let’s examine the specific exposures hiding in each area:
Claims Processing: The High-Volume, High-Sensitivity Risk Zone
Claims files contain the perfect storm of sensitive information: personally identifiable information (PII), protected health information (PHI), financial details and sometimes even photos or documentation of damages. This data flows between multiple parties—claimants, adjusters, healthcare providers, legal counsel and third-party administrators.
The risks here are substantial. Without proper controls, claims data can be:
- Intercepted during transmission between external partners
- Accessed by unauthorized internal users
- Exposed through delivery to incorrect recipients
- Leaked through inadequate partner security practices
Warning: Claims processing typically involves third-party administrators (TPAs) who handle sensitive data on your behalf. Your security is only as strong as theirs. Recent breaches have shown that third-party risk remains one of the largest exposure points for insurers.Underwriting: Protecting Your Foundational Data Assets
Underwriting represents the core of your business—and contains some of your most sensitive data assets. The process involves collecting extensive applicant information including financial records, medical history, credit scores and other risk-assessment data.
This creates unique challenges:
The underwriting process often relies on secure document collection from applicants and agents. When these channels are inadequate, sensitive information can be exposed before it even enters your systems. (Think about it: you wouldn’t keep your cash in a leaky vault, so why are you keeping PII in the digital equivalent of a cardboard box?)
Moreover, underwriting processes frequently leverage legacy systems with limited security capabilities. These older systems weren’t designed for today’s threat landscape and may lack modern encryption, access controls and audit capabilities. It’s like protecting your crown jewels with a lock from 1985—quaint, but hardly effective.
Customer Communications: The Continuous Exposure Challenge
Even routine communications with policyholders involve constant transmission of sensitive information. Policies, statements, notifications and customer service interactions all contain data that could expose you to risk if not properly secured.
A single compromised customer communication can trigger a notification event under various state breach laws. With the cost of breaches increasing year over year, unsecured customer communications represent a significant financial exposure.
In this area, we typically see:
Unencrypted email communications containing policy details or personally identifiable information
Insecure customer portals with inadequate authentication
Lack of visibility into who accessed sensitive documents and when
Inconsistent approaches across different lines of business
When ‘Claims’ Occur: The Real Cost of Inadequate Coverage
When file transfer security fails, the consequences can be devastating. Recent breaches illustrate just how expensive inadequate “coverage” can be.
The financial impact of such breaches goes far beyond immediate remediation costs:
Regulatory penalties (up to $1.5M per HIPAA violation category annually)
Legal settlements (commonly reaching 8 figures for large breaches)
Brand damage and customer churn (particularly damaging in an industry built on trust)
Operational disruption during investigation and remediation (nothing says “productive workday” like explaining to executives why customer data is trending on social media)
MOVEit: The Bolstered Coverage You Need
Just as comprehensive insurance protects against a wide range of perils, Progress MOVEit Managed File Transfer software helps provide the coverage your file transfers need. Unlike point solutions that address only specific aspects of security, MOVEit software helps deliver protection across your entire data exchange ecosystem.
MOVEit policy benefits include:
Protection in Transit and At Rest: Security measures that help close critical gaps in your security posture. This approach helps protect files throughout their lifecycle, from upload to share.
Tamper-Evident Audit Trails: File transactions are logged in cryptographically chained records that provide detailed evidence of who accessed what data, when and how. These audit capabilities are essential for helping to demonstrate compliance with GLBA, HIPAA and state privacy laws during regulatory examinations. Because “I don’t know who accessed our customer data” is never a good answer during an audit.
Multi-Layered Access Controls: Granular permissions, multi-factor authentication and integration with enterprise identity systems help limit sensitive information access to authorized individuals. This defense-in-depth approach helps significantly reduce the risk of unauthorized access or insider threats.
Secure Ecosystem Integration: MOVEit software facilitates secure file exchange with the entire insurance ecosystem—brokers, agents, TPAs, healthcare providers and regulatory bodies—while enabling central control and visibility. This capability is particularly valuable for helping to manage third-party risk, a critical concern for insurers.
Assessing Your Coverage: A File Transfer Risk Checkup
How well is your current file transfer “policy” protecting you? Ask yourself:
- Can we definitively track who accessed every sensitive file, when and what they did with it?
- Are we using encrypted protocols exclusively for all sensitive data transfers?
- Do we have centralized visibility and control across all file transfer methods?
- Are our third-party data exchanges secured to the same standards as our internal transfers?
If you answered “no” to any of these questions, your coverage has dangerous gaps that need to be addressed. And let’s be honest—you probably winced at least once while reading that list.
Conclusion: Upgrading Your Policy
Insurance professionals understand better than most that adequate protection requires comprehensive coverage without significant exclusions. Yet many companies that expertly assess others’ risks have critical gaps in their own file transfer security.
Just as you wouldn’t recommend minimum coverage for your clients’ most valuable assets, you shouldn’t settle for partial protection of your sensitive data. MOVEit MFT helps provide the coverage your organization needs—protection that helps address the full spectrum of file transfer risks across claims processing, underwriting, customer communications and third-party exchanges.
Ready to upgrade your file transfer “policy”? Learn more about MOVEit protection and verify that your sensitive data transfers have the coverage they deserve.
Continue reading...