Top 10 Tips for Creating a Data Loss Prevention Policy

Not long ago, most company resources were located within a defined perimeter and users worked in the office using company-owned devices. In that world,  access-centric security policies were enough to safeguard sensitive data.  

But most organizations have now adopted a host of cloud applications, and users work from anywhere on any device and network. To secure sensitive data in this new setup, organizations must transition from an access-centric approach to a data-centric security approach.  The crucial first step is implementing an effective data loss prevention policy.

This guide will provide a comprehensive overview of how data loss prevention (DLP) policies function within modern application development while also offering actionable steps for your organization as it crafts its own DLP policies.

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Understanding data loss prevention policies

What is a data loss prevention policy?

A data loss prevention policy involves a set of technologies and processes used to discover, monitor, and control sensitive data. Successfully implementing DLP policies reduces the opportunity for data breaches and helps you comply with all relevant security and legal regulations, such as HIPAA, PCI DSS, and GDPR.

DLP policies are a vital part of successfully transitioning to a data-centric security framework. These frameworks shift the security focus from merely limiting user access to sensitive data to denoting and controlling where data is stored, how it’s stored, and whether it should even be stored in the first place. DLP policies provide guardrails for employees throughout your organization so everyone who interacts with critical systems follows security and compliance best practices as required.

The importance of having a DLP policy in today’s digital world

Organizations have an obligation to protect sensitive data. Failing to do so can lead to significant consequences, such as steep fines, loss of revenue, damaged reputation, and even a loss of the ability to do business in some regions of the world. 

The two primary ways DLP policies help to prevent data breaches and enhance public trust are:

• Compliance with industry and government regulations. Your organization may need to comply with a series of legal requirements depending on your industry, the data you collect and store, and the region where you do business, such as HIPAA for the healthcare industry or GDPR in the European Union. DLP policies put internal guidelines in place that meet these regulatory requirements more consistently than manual processes.
• Protecting proprietary information. In addition to storing sensitive customer data, corporations must secure their own proprietary data, such as company secrets and intellectual property. DLP policies provide enforceable standards to secure this information within your data servers. They also put processes in place to educate employees on the sophisticated psychological techniques cyber attackers use to gain access, as well as proper data usage and sharing policies to prevent accidental leaks or exposure.

3 types of data loss prevention

There are three main types of DLP techniques your organization can implement to keep its data secured:

• Endpoint DLP involves protecting information where it is most likely to be used, such as on company desktops, laptops, and smart devices. As your organization relies on an increasing number of internet-capable devices (including IoT sensors) and remote workers, it must monitor and secure any data used at the endpoint. 
• Cloud DLP is similar to endpoint DLP, except the focus is on data stored and accessed within a cloud-based infrastructure. DLP policies will monitor cloud access and usage as well as network traffic to enhance your security posture.
• Data leakage prevention implements policies and procedures that prevent unintentional exposure. It covers several areas, including preventing malicious attempts to access data through phishing attacks and accidental exposure of sensitive data on publicly accessible websites.

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10 essential steps for creating a robust data loss prevention policy

1. Use data loss prevention software

While manual data loss prevention may have been sufficient in the past, the complexity and scale of modern cloud architecture make this all but impossible now. Relying on automated data loss prevention software will grant 24/7 monitoring and visibility into your entire infrastructure. 

These tools provide advanced detection and prevention capabilities, leveraging artificial intelligence (AI) and machine learning (ML) algorithms to discover and alert you to security gaps before they become critical vulnerabilities. They’ll also help detect and track anomalous activity within your networks so you can shut down malicious actions before they occur.

2. Identify and classify data

Some data is more critical than others. Credit card payment information must be adequately encrypted in transit and at rest, while an event flyer that is accessible to the public likely does not. Unless you know which data needs to be secured, you may be allocating too many resources — or not enough — to securing essential information.

You can start to prioritize the most sensitive information on your network by identifying which data requires greater security measures and then classifying it with appropriate metadata. This process also pairs nicely with data loss prevention software, making it easier for non-technical employees to follow DLP policies.

3. Create access controls

Even with a data-centric security approach, you still want to lock down sensitive information and limit access to authorized users. Implement least-privilege access controls so employees only have access to information they need to do their jobs and nothing more. 

These controls should be managed on an account level, so you can create ready-made user groups to limit data access to various departments. For example, only the accounting department should be able to access company financial records, so you could create an access control group that only contains accounting employees. You should also set access controls at the file level — so if there’s a particularly sensitive accounting file, only senior department members will have access while the rest of the employees won’t. 

Access controls should be verified at the endpoint through passwords and multi-factor authentication systems. However, that’s not enough to create a robust zero-trust environment. Consider also implementing continuous data and endpoint telemetry systems that will monitor each user as they interact with systems and alert you to any suspicious behavior. 

4. Monitor data activity

Speaking of suspicious behavior, abnormal activity can pop up anywhere throughout the network. Security teams should investigate any suspicious behaviors such as people accessing files at odd hours of the night, uploading or downloading large volumes of data, or rapidly accessing multiple directories.

User and entity behavior analytics (UEBA) can detect patterns and notice outliers by continuously monitoring data streams, network traffic, and user activity. Noticing these kinds of irregularities early is a critical step in detecting and preventing data breaches before they occur.

5. Educate employees

While some malicious actors will attempt to gain access via brute force intrusion, the vast majority of data breaches result from human error. In fact, one study conducted by Stanford University found that 88% of data breaches are caused by employee mistakes, whether accidentally clicking on a link in a phishing email or simply being lax with confidential information while working from home. 

Employee training is an essential part of any data loss prevention policy. Training should include instruction on data security best practices, why data protection is an integral part of everyday operations, and the consequences of failing to take data protection seriously. To truly foster a culture of security throughout your organization and make employees more aware of their role in reducing data breaches, your education processes should reinforce traditional training sessions with regular email updates about new security policies and updated intrusion techniques.

6. Encrypt data 

Storing sensitive customer information — like passwords or Social Security numbers — in plain text is a data leak horror story waiting to happen. All it takes is a single mistake for someone to gain access to instantly usable information that can wreak havoc on potentially millions of people’s lives. 

By employing encryption techniques on this data at rest, in transit, and in use, you can prevent malicious actors from viewing or using it, even if they somehow gain access. Encrypt sensitive information using enterprise digital rights management (EDRM) tools that work with your DLP for a more comprehensive approach to data security. 

7. Implement data backup

Data breaches aren’t the only way to lose information. Hard drives can fail, servers can go down, and human error can cause valuable data to disappear completely. While events such as these should never be taken lightly, they’re less of a headache if you have a backup available that you can use to restore the system. Create a data backup schedule that makes sense for your organization to prevent data loss that results from a system failure or breach. 

8. Implement complementary endpoint security

There isn’t a single solution to data loss prevention. An effective DLP policy relies on an ecosystem of tools that work together to provide insights, develop plans of action, and actively protect your data. 

These tools are especially important in a corporate environment where employees can work from anywhere at any time. Cloud-based secure web gateways (SWG) help to monitor and restrict network access both on- and off-premises. Cloud access security brokers (CASB) extend the reach of your DLP policies beyond the confines of your on-premises infrastructure and into the cloud. And zero trust network access (ZTNA) tools restrict access to specific applications rather than the entire network. Applying a combination of these endpoint security tools will maximize the coverage of your DLP policies.

9. Establish incident response procedures

If a data breach occurs, you don’t want to respond without a plan. That’s why you should develop, document, and implement incident response procedures to minimize operational impact.

While every organization’s response plan will be unique, they typically contain five phases response teams will work through in the event of a breach as laid out in the NIST SP 800-61 Rev. 2 Computer Security Incident Handling Guide:

1. Incident detection
2. Incident containment
3. Incident eradication
4. Incident recovery
5. Communication and reporting

10. Conduct regular security audits and update policies as needed

Malicious actors continuously evolve their tactics to stay one step ahead of security teams, so you need to keep updating your processes in turn. Perform regular security audits to assess how effective your DLP policy is, identify vulnerabilities, and make the necessary improvements.

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DLP policies protect you and your customers 

Data protection isn’t just a choice; it’s necessary in today’s interconnected world. A robust data loss prevention policy is the best way to safeguard sensitive information and keep your company and your customers secure.

Strengthen your DLP policies and gain full insight into your data with the Lookout Cloud Security Platform. It offers seamless protection and policy enforcement across endpoints, cloud services, and other touchpoints to maximize your security posture. 

Learn more about how Lookout’s data loss prevention tools can unlock enhanced data security and productivity for your organization — no matter where people work.

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Frequently asked questions

Are there any legal implications for not having a data loss prevention policy in place?

While a data loss prevention policy is usually not legally required, having one in place can reduce the likelihood of a data breach and can offer legal protection if one should occur.

However, failure to protect sensitive information can result in significant consequences, including legal action, regulatory fines, reputational damage, and a loss of customer trust.

How does technology play a role in enforcing a data loss prevention policy within an organization?

Advanced technologies, such as artificial intelligence and DLP software tools, enhance DLP policies and make developing and implementing them at scale possible. They also unlock real-time detection of data breaches, automate policy enforcement, and improve incident response capabilities so your department can get the most out of its allocated resources.

What are common challenges companies face when implementing a data loss prevention policy?

Common challenges include:

• Complexity of data classification
• Integrating DLP solutions with existing IT infrastructure
• User compliance with DLP policies
• Ensuring policies align with the organization’s data management practices

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