Following a 2022 recommendation from its ERISA Advisory Council, the Department of Labor on Sept. 6 issued new guidance confirming that the Employee Benefits Security Administration’s (EBSA) 2021 guidance on cybersecurity applies to all ERISA-covered employee benefit plans, including health and welfare plans.
In the years since the 2021 guidance, health and welfare plan service providers have told fiduciaries and EBSA investigators that the guidance only applies to retirement plans. Friday’s update clarifies that is not the case, and the guidance does indeed cover health and welfare plans.
The new Compliance Assistance Release issued by EBSA provides best practices in cybersecurity for plan sponsors, plan fiduciaries, recordkeepers and plan participants. The release updates EBSA’s 2021 guidance and includes the following:
- Tips for Hiring a Service Provider: Helps plan sponsors and fiduciaries prudently select a service provider with strong cybersecurity practices and monitor their activities, as ERISA requires.
- Cybersecurity Program Best Practices: Assists plan fiduciaries and recordkeepers in mitigating risks.
- Online Security Tips: Offers plan participants who check their online retirement accounts with rules for reducing the risk of fraud and loss.
“Today’s Compliance Assistance Release provides an important clarification for plan sponsors and fiduciaries, confirming that our guidance on cybersecurity applies to all plans covered by the Employee Retirement Income Security Act,” Assistant Secretary for Employee Benefits Security Lisa M. Gomez said. “All ERISA-covered plans need to implement appropriate best practices to help protect participants and their beneficiaries from cybercrime and emerging threats. These updates remind plan sponsors and fiduciaries of the critical importance of safeguarding job-based benefits and personal information.”
“These updates remind plan sponsors and fiduciaries of the critical importance of safeguarding job-based benefits and personal information.”
EBSA’s Lisa Gomez
As of June 2024, EBSA estimates ERISA covers 2.8 million health plans, 619,000 other welfare benefit plans and 765,000 private pension plans in America. These plans include 153 million workers, retirees and dependents who participate in private sector pension and welfare plans with $14 trillion in estimated assets. Without sufficient protections, digital participant and assets information may be vulnerable to the internal and external risks of computer-related crimes and losses. Federal regulations require plan fiduciaries to take appropriate precautions to mitigate these risks.
“The Employee Benefits Security Administration believes cybersecurity is a great concern for all employee benefit plans and we continue to investigate potential ERISA violations related to the issue,” Gomez added.
The guidance complements EBSA’s regulations on electronic records and disclosures to plan participants and beneficiaries. These include provisions on ensuring that electronic recordkeeping systems have reasonable controls, adequate records management practices are in place and that electronic disclosure systems include measures calculated to protect Personally Identifiable Information.
SEE ALSO:
• DOL Releases Cybersecurity Guidance for 401k Plans
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.