Expect Focus Life, Annuity, and Retirement Solutions, September 2023

SEC Deals New Cybersecurity Disclosure Requirements to Public Companies

Life, Annuity, and Retirement Solutions   |   Securities Litigation and Enforcement   |   Securities & Investment Companies   |   Cybersecurity and Privacy   |   Life, Annuity, and Retirement Solutions   |   September 28, 2023

On July 26, 2023, the SEC adopted new cybersecurity rules, which have two top-line impacts. First, registrants must disclose material cybersecurity incidents promptly on Form 8-K. Second, registrants must disclose new information regarding cyber risk management, strategy, and governance as part of their annual disclosures. These requirements apply to public company registrants with the SEC, including insurance companies (but not investment company registrants).

As to current disclosures, the rules add Item 1.05 to Form 8-K, requiring the disclosure of material cybersecurity incidents, including the nature, scope, and timing of the incident. The disclosure will be generally due four business days after the registrant determines materiality, which some registrants will think makes them disclose their hand prematurely. There is an exception to that disclosure timeframe, if the U.S. attorney general determines there is a substantial risk to national security or public safety and so notifies the SEC in writing. But such an exception will likely be difficult to obtain within the rules’ four-day deadline.

As a practical matter, therefore, this disclosure might necessarily be high level and based on less-than-perfect information, because the investigation of such larger cybersecurity incidents often takes weeks or months. This is particularly true for events with multiple moving parts, such as a ransomware attack with data exfiltration and an extortion demand, where the impact on personal information may not even be known within the four-day period.

As to annual disclosures, the rules add Item 106 to Regulation S-K, requiring the following new disclosures in the registrant’s annual report on Form 10-K:

  • A description of the registrant’s processes for assessing, identifying, and managing material cybersecurity risks.
  • Disclosures as to the material effects of previous cybersecurity incidents.
  • Disclosures as to management’s role and expertise in managing cybersecurity risks and as to the board’s oversight of those risks.

Registrants will need to start planning for compliance immediately, as the rules took effect on September 5. The Form 10-K disclosures start on annual reports for fiscal years ending on December 15, 2023. The Form 8-K requirements start on December 18, 2023, although smaller reporting companies have an extension to June 15, 2024.

Public companies should revisit their incident response plans, to see if they would benefit from additional processes to determine when a cyber incident could be material and, if so, who will be responsible for any necessary disclosures on Form 8-K within the four-business-day timeframe. Public companies should also work with their disclosure counsel to gather information for disclosure through new Item 106 on their annual reports.


©2023 Carlton Fields, P.A. Carlton Fields practices law in California through Carlton Fields, LLP. Carlton Fields publications should not be construed as legal advice on any specific facts or circumstances. The contents are intended for general information and educational purposes only, and should not be relied on as if it were advice about a particular fact situation. The distribution of this publication is not intended to create, and receipt of it does not constitute, an attorney-client relationship with Carlton Fields. This publication may not be quoted or referred to in any other publication or proceeding without the prior written consent of the firm, to be given or withheld at our discretion. To request reprint permission for any of our publications, please use our Contact Us form via the link below. The views set forth herein are the personal views of the author and do not necessarily reflect those of the firm. This site may contain hypertext links to information created and maintained by other entities. Carlton Fields does not control or guarantee the accuracy or completeness of this outside information, nor is the inclusion of a link to be intended as an endorsement of those outside sites.

Subscribe to Publications


The information on this website is presented as a service for our clients and Internet users and is not intended to be legal advice, nor should you consider it as such. Although we welcome your inquiries, please keep in mind that merely contacting us will not establish an attorney-client relationship between us. Consequently, you should not convey any confidential information to us until a formal attorney-client relationship has been established. Please remember that electronic correspondence on the internet is not secure and that you should not include sensitive or confidential information in messages. With that in mind, we look forward to hearing from you.