Benefits of a password policy

When you hear about cybersecurity, one of the first things that you’re told is that a good password and multi-factor authentication (MFA) play central roles in keeping your accounts safe. Strong passwords make it a lot more difficult for any hacker to crack your code and get access to your private files and documents.

The rising cyberthreat has resulted in organizations, websites and online platforms implementing password policies into their threat management and policies.

We’ll take a closer look at what exactly a password policy is, and what makes it an essential part of proper cybersecurity.

What is a password policy?

If an organization, website or online platform chooses to implement a password policy, it means that they make a set of rules and guidelines about password security that any employee or user has to meet.

The policies are made to improve the security around user accounts and their sensitive information. When they have a strong and unique password, it becomes a lot harder for unauthorized users - or hackers - to crack the code. Password policies are thus an essential part of any organization’s cybersecurity.

A password policy will typically include:

Requirement of a long password: A password policy usually has a minimum and maximum length. The longer the password, the more difficult it is to crack and guess.

• Complexity: This requirement entails including special characters, numbers and lowercase and uppercase letters in your password. Again, more complex passwords are difficult to crack as they make the possibilities almost endless.

• Password history: This defines how often you can change your password and thus prevents users from reusing previous passwords. Even though it’s annoying to us to create a new password combination, it’ll improve the cybersecurity significantly.

• Account lock: This sets a specific number of attempts you have to log into your account before it is temporarily locked. When you have an account lock you prevent brute-force attacks where hackers attempt many different combinations to force their way into your account.

• Updated passwords: This requirement specifies when you need to change your password. Often it is between 6 months to a year that you have to change your password; and not use an old password as the requirement about password history describes.

• MFA: MFA encourages users to have additional security around their passwords. You thus need another authentication method other than solely your password (like biometric data and one-time passwords).

• Recovering your password: With policies about how you recover your forgotten password will ensure that only you or authorized people will be able to recover it.

• Awareness training: Training in cybersecurity helps employees see the importance of e.g. strong passwords and improved account security. Here they’ll learn to spot phishing attempts and safeguard their data.

• Storing passwords: It specifies how you should store your passwords, if you choose to do so. This includes secure hashing algorithms and encryption to protect your passwords from being stolen and misused.

• Admin access: This describes how admins can improve and manage established password policies across user accounts within software and the organization.

• Security audits: Having regular security audits entails having assessments and check ups of the effectiveness of your password policies and also to detect potential vulnerabilities and weaknesses.

• Password managers: One of the tools that can help you improve your password security is password managers. They are a sort of vault that stores and generates new and complex passwords to every single website you log on to.

There are a lot of things a password policy can entail but it is these initiatives that help protect you and your organization from potential hacking attacks. You can reduce the risk of data breaches and other cybersecurity incidents and thus protect sensitive information - both yours but also your customers. This maintains trust between everyone.

Risks of not having a password policy

It may seem like a lot of work to implement and comply with a password policy, however following these requirements will help you minimize potential vulnerabilities and weaknesses in your systems.

Hackers will use many different methods in order to breach your cyberdefense like the aforementioned brute-force attacks, but also through e.g. dictionary attacks and phishing. Once they crack a weak password, they get access to your data, which can thus lead to identity theft, financial loss and many other incidents.

Without a password policy, users may not be aware of the threats they expose an organization or themselves to.

The main concern there is if you don’t comply with a password policy is how vulnerable your accounts become. Again, it seems like a lot of work to follow each requirement in the password policy, but they are here to help.

Hackers have become incredibly good at their jobs, so cracking a password that includes your birthday or your pet’s name is child’s play to them. This will lead to data breaches and exploitation of personal data, which can cost you and your workplace lots of money and resources.

Benefits of a strong password policy

Just to brush up why you should have a strong password policy, we’ll take a look at the benefits of a good password policy.

First of all, it improves your cybersecurity. It acts as a defense mechanism making it harder for outsiders to get inside your walls. It thus protects sensitive data from being stolen and exploited. You can save a lot of money and resources if you have implemented a good password policy as you make it a lot harder for hackers to get the information you use to access e.g. online banks.

In connection with this, you prevent identity theft. Hackers often try to impersonate people to execute even more hacking attacks through phishing and social engineering and impersonation attacks. If a customer is hit by an impersonation attack, you will lose their trust and partnership immediately. If you on the contrary show that you implement password policies and improved cybersecurity, they’ll have greater trust in you and your organization.

Lastly, it'll save you a lot of resources. It will cause a lot of damage if you’re struck by a cyberattack - which again can happen through brute force attacks that guess your password. If you eliminate this entry point you thus eliminate the cost of losing access to your data and systems.

Strong passwords = strong cybersecurity

Password policies will help you protect data and customer relations. It stands as one of the first lines of defenses in our cybersecurity.

A good password policy will often include many different initiatives such as MFA, unique passwords and password history. Employee training helps raise awareness around the security surrounding your passwords; we might not think about just how important it is to have a strong password security.

It’s a good start to make a strong and unique password to your accounts - and not use the same password to your different accounts. Here password managers can help you; otherwise you can read our guide to make strong passwords here.