Encryption and Key Management Policy (OP-POL-001)

1. Objective

The objective of this policy is to establish comprehensive requirements for the implementation, management, and governance of cryptographic controls and encryption key management at [Company Name]. This policy ensures that sensitive information, particularly electronic Protected Health Information (ePHI), is protected through appropriate encryption technologies and that cryptographic keys are securely generated, distributed, stored, and disposed of in compliance with HIPAA, HITECH, and SOC 2 requirements.

2. Scope

This policy applies to all [Company Name] workforce members, contractors, and third parties who handle, process, store, or transmit encrypted information or manage cryptographic keys. It encompasses all information systems, applications, databases, storage devices, communication channels, and backup media containing sensitive data. This policy covers all encryption technologies, including symmetric and asymmetric encryption, digital signatures, and cryptographic hashing, across all computing environments including on-premises, cloud, and mobile platforms.

3. Policy

[Company Name] shall implement and maintain comprehensive, auditable cryptographic controls to protect the confidentiality, integrity, and authenticity of sensitive information throughout its lifecycle.

3.1 Encryption Requirements

Encryption shall be implemented for all sensitive information based on data classification levels and regulatory requirements.

3.1.1 Mandatory Encryption Requirements

The following data types and scenarios require mandatory encryption using algorithms approved in section 3.1.2 of this policy:

Electronic Protected Health Information (ePHI):

• ePHI at rest: Encrypted using AES-256 or a stronger approved algorithm.
• ePHI in transit: Encrypted using TLS 1.2 or higher, with a strong cipher suite configuration.
• ePHI on mobile devices and removable media: Full device/media encryption is mandatory.

Confidential and Restricted Data:

• Database encryption for sensitive data fields using transparent data encryption (TDE) or column-level encryption
• File system encryption for servers and workstations storing sensitive information
• Email encryption for messages containing sensitive data
• Backup encryption for all backup media and archives

Authentication Credentials:

• Password hashes using a strong, salted cryptographic hash function (e.g., bcrypt, Argon2).
• API keys and tokens encrypted at rest.
• Digital certificates and private keys protected by hardware security modules (HSMs) or equivalent secure key storage mechanisms.

3.1.2 Encryption Standards and Algorithms

Only cryptographically strong, industry-standard algorithms and protocols approved by the Security Officer shall be used. The use of any algorithm not on the approved list is prohibited.

Approved Symmetric Encryption Algorithms:

• AES (Advanced Encryption Standard) with key lengths of 128, 192, or 256 bits
• ChaCha20-Poly1305 for authenticated encryption

Approved Asymmetric Encryption Algorithms:

• RSA with minimum key length of 3072 bits (4096 bits preferred).
• Elliptic Curve Cryptography (ECC) with minimum key length of 256 bits.

Approved Hash Functions:

• SHA-256, SHA-384, SHA-512 for data integrity
• bcrypt, scrypt, or Argon2 for password hashing

Prohibited Algorithms:

• DES (Data Encryption Standard) and 3DES
• MD5 and SHA-1 hash functions
• RC4 stream cipher
• RSA keys shorter than 3072 bits
• SSL v2, SSL v3, TLS 1.0, TLS 1.1

3.2 Key Management Framework

A comprehensive key management system shall be implemented to ensure the secure lifecycle management of all cryptographic keys.

3.2.1 Key Management Principles

• Separation of Duties: Key management roles and responsibilities shall be formally assigned and separated to prevent any single individual from having unilateral control over a key’s lifecycle.
• Least Privilege: Access to cryptographic keys shall be restricted to the minimum necessary for an individual or system to perform its authorized function.
• Key Escrow: Critical encryption keys required for data recovery shall be securely escrowed. The process for accessing escrowed keys shall require documented approval from at least two authorized individuals.
• Audit Trail: All key management activities, including generation, distribution, rotation, and destruction, shall be logged in a secure, immutable audit trail and monitored for anomalies.

3.2.2 Key Generation

• Keys shall be generated using approved cryptographically secure random number generators (CSRNGs)
• Key generation shall occur in secure, controlled environments
• Hardware Security Modules (HSMs) or equivalent secure hardware shall be used for high-value key generation
• Weak or predictable keys shall be rejected through automated validation processes

3.2.3 Key Distribution and Exchange

• Key distribution shall use secure, authenticated channels (e.g., TLS 1.2 or higher).
• Public key infrastructure (PKI) shall be the primary method for asymmetric key distribution.
• Key exchange protocols shall be configured to provide perfect forward secrecy (PFS). Any deviation shall be documented and approved by the Security Officer.
• Manual key distribution is prohibited without dual control and documented, time-bound approval from the Security Officer.

3.2.4 Key Storage and Protection

• Encryption keys shall be stored separately from the data they protect
• Master keys shall be stored in HSMs or equivalent tamper-resistant hardware
• Key storage systems shall be hardened and subject to strict access controls
• Encryption keys shall themselves be encrypted at rest using a separate key encryption key (KEK).
• Cloud-based key management services (e.g., AWS KMS, Azure Key Vault) must be configured in accordance with the [Company Name] Infrastructure Security Policy (ENG-POL-003) and Vendor and Third-Party Risk Management Policy (SEC-POL-005).

3.2.5 Key Usage and Access Controls

• Key access shall be granted only to authorized personnel and applications
• Multi-factor authentication shall be required for access to key management systems
• Key usage shall be logged and actively monitored for unauthorized access attempts or anomalous usage patterns.
• Automated key rotation shall be implemented. Where automation is not technically feasible, the justification must be documented and approved by the Security Officer, and a manual rotation schedule must be tracked.
• Emergency key access procedures shall be documented, tested annually, and require multi-person control.

3.2.6 Key Rotation and Lifecycle Management

Encryption keys shall be rotated at or before the following minimum frequencies. A shorter rotation period shall be used if required by a specific regulation, standard, or risk assessment.

• Data encryption keys: Annually or after encrypting [Amount, e.g., 1TB] of data, whichever comes first.
• Key encryption keys: Every 2 years.
• SSL/TLS certificates: Annually, or as required by the Certificate Authority.

• Authentication keys (e.g., API keys): Every 6 months.

• Emergency key rotation shall be performed immediately upon:
  • Suspected key compromise
  • Workforce member termination with key access
  • System security incidents involving key management systems
  • Vendor security breaches affecting key material

3.2.7 Key Destruction and Disposal

• Cryptographic keys shall be securely destroyed as soon as they are no longer required for business or legal purposes.
• Key destruction shall use cryptographically secure deletion methods (e.g., cryptographic erasure, overwriting with random data multiple times).
• HSMs shall perform secure key zeroization procedures.
• Physical destruction of media that stored keys shall be performed in accordance with the Data Retention and Disposal Policy (OP-POL-003) and be verified and documented.
• All key destruction activities shall be logged and auditable.

3.3 Digital Certificates and Public Key Infrastructure (PKI)

[Company Name] shall maintain appropriate PKI capabilities to support digital certificates and public key cryptography.

3.3.1 Certificate Authority (CA) Management

• Internal CA infrastructure shall be established for organizational certificates
• Root CA systems shall be offline and stored in physically secure locations
• Intermediate CAs shall be used for day-to-day certificate issuance
• External CAs shall be evaluated and approved for specific use cases

3.3.2 Certificate Lifecycle Management

• Certificate requests shall be validated and approved through a formal, documented process managed by the IT Security Team.
• Certificate templates shall be used to enforce appropriate key usage, algorithm strength, and validity periods.
• Certificate revocation capabilities shall be maintained and tested annually through Certificate Revocation Lists (CRLs) or Online Certificate Status Protocol (OCSP).
• Automated monitoring and alerting shall be implemented to ensure expired or revoked certificates are removed from systems at least 7 days prior to expiration.

3.4 Cloud Encryption and Key Management

All use of cloud services must adhere to the following cryptographic requirements, as detailed in the Infrastructure Security Policy (ENG-POL-003).

3.4.1 Cloud Encryption Requirements

• Customer-managed encryption keys (CMEK) shall be used for all production data stores containing ePHI or other Restricted data in cloud environments.
• Encryption shall be implemented at multiple layers (e.g., application, database, storage, network) to provide defense-in-depth.
• Cloud provider encryption services and configurations shall be reviewed and approved by the IT Security Team before use.
• Data sovereignty and residency requirements shall be enforced through technical controls for all data stored in the cloud.

3.4.2 Cloud Key Management

• [Company Name]-controlled key management services (e.g., AWS KMS, Azure Key Vault) shall be the required standard for all cloud-based encryption.
• Hybrid key management architectures (e.g., “Hold Your Own Key” or HYOK) shall be implemented where feasible to maintain on-premises control of master keys for the most sensitive data.
• Cloud HSM services shall be used for high-security applications as determined by the Security Officer.
• Key export capabilities shall be tested annually to ensure data can be decrypted and migrated, preventing vendor lock-in.

3.5 Encryption Performance and Monitoring

Encryption implementations shall be monitored for performance impact and security effectiveness.

3.5.1 Performance Monitoring

• Encryption overhead shall be measured and optimized
• Hardware acceleration shall be used where available and appropriate
• Application performance impact shall be assessed and mitigated
• Capacity planning shall account for encryption processing requirements

3.5.2 Security Monitoring

• Cryptographic failures, errors, and misconfigurations shall be logged and trigger automated alerts to the IT Security Team for immediate investigation.
• Key management system access and activity logs shall be ingested into a Security Information and Event Management (SIEM) system and monitored for suspicious activity.
• Automated certificate expiration monitoring and alerting shall be implemented to prevent service disruptions.
• An annual review of cryptographic standards shall be conducted to maintain a crypto-agility plan, addressing algorithm obsolescence and emerging threats such as quantum computing.

4. Standards Compliance

This policy is designed to comply with and support the following industry standards and regulations.

Policy Section	Standard/Framework	Control Reference
3.1.1	HIPAA Security Rule	45 CFR § 164.312(a)(2)(iv) - Encryption and Decryption
3.1.1	HIPAA Security Rule	45 CFR § 164.312(e)(2)(ii) - Encryption
All	HIPAA Security Rule	45 CFR § 164.312(e)(1) - Transmission Security
3.2	SOC 2 Trust Services Criteria	CC6.1 - Logical Access Security
3.1, 3.2	SOC 2 Trust Services Criteria	CC6.6 - Other Controls to Achieve Logical Access Security Objectives
3.2	SOC 2 Trust Services Criteria	CC6.8 - Restricts Access to Encrypted Data
All	NIST Cybersecurity Framework	PR.DS-1: Data-at-rest is protected.
All	NIST Cybersecurity Framework	PR.DS-2: Data-in-transit is protected.
3.2	NIST SP 800-57	Recommendation for Key Management
All	ISO/IEC 27001:2022	A.8.24 - Use of cryptography

5. Definitions

Advanced Encryption Standard (AES): A symmetric encryption algorithm adopted as a U.S. Federal Government standard.

Certificate Authority (CA): An entity that issues digital certificates certifying the ownership of public keys.

Cryptographically Secure Random Number Generator (CSRNG): A random number generator that meets cryptographic security requirements.

Hardware Security Module (HSM): A dedicated cryptographic device designed to securely generate, store, and manage cryptographic keys.

Key Escrow: The practice of storing cryptographic keys with a trusted third party for recovery purposes.

Public Key Infrastructure (PKI): A framework for managing digital certificates and public key encryption.

Transport Layer Security (TLS): A cryptographic protocol for secure communication over computer networks.

Transparent Data Encryption (TDE): Database encryption technology that encrypts data files at rest.

6. Responsibilities

Role	Responsibility
Security Officer	Develop encryption policies, oversee key management program, and ensure compliance with cryptographic standards.
IT Security Team	Implement encryption technologies, manage key management systems, and monitor cryptographic controls.
System Administrators	Configure and maintain encryption systems, perform key rotation procedures, and ensure proper encryption deployment.
Database Administrators	Implement database encryption, manage database encryption keys, and ensure encrypted backup procedures.
Cloud Engineers	Configure cloud encryption services, manage cloud-based key management, and ensure proper cloud cryptographic controls.
Application Developers	Implement application-level encryption using approved cryptographic libraries, protect secrets in code, and follow secure coding practices as defined in the Secure Software Development Policy (ENG-POL-001).
Privacy Officer	Ensure encryption requirements meet privacy obligations, oversee ePHI encryption protections, and coordinate with the Security Officer on data protection strategies.
All Workforce Members	Use encryption tools as required, protect credentials used for encryption systems, and immediately report suspected encryption failures or key compromises to the IT Security Team.

7. Enforcement

Failure to comply with this policy may result in disciplinary action, up to and including termination of employment or contract, in accordance with [Company Name]’s Human Resources Security Policy (OP-POL-004). Violations may also carry civil and criminal penalties.

8. Exceptions

Any exception to this policy must be documented, identifying the associated risks and mitigating controls, and must be submitted to the Security Officer for formal written approval. Approved exceptions will be reviewed on an annual basis.