Why SOC 2 Compliance Matters for Modern Claims Organizations

Claims professionals handle some of the most sensitive information a person can share. A single claim file may include a name, home address, date of birth, Social Security number, medical history, and vehicle or property information. As that file moves between a carrier, TPA, and other vendors, every handoff creates another opportunity for data to be exposed.

That’s why SOC 2 Type 2 compliance continues to be one of the strongest indicators of a vendor’s commitment to data security. With third-party breaches continuing to rise and AI becoming a part of everyday claims workflows, claims organizations can’t afford to overlook data security.

What Is SOC 2 Type 2?

SOC 2 (System and Organization Controls 2) is a certification developed by the American Institute of Certified Public Accountants (AICPA). It is awarded after an independent third-party audit confirms that a service organization has effective controls in place to protect sensitive data. During the audit, organizations are evaluated against five Trust Services Criteria: security, availability, processing integrity, confidentiality, and privacy.

Why SOC 2 Type 2 Matters for Claims Organizations

Claims investigations, medical bill review, and workers’ compensation programs all rely on information being shared between carriers, TPAs, employers, and third-party vendors. While that collaboration is necessary, it also creates more opportunities for data to be compromised.

According to Verizon’s 2026 Data Breach Investigations Report, third-party involvement now plays a role in 48% of all data breaches. For an industry that depends heavily on outside partners, a current SOC 2 Type 2 report is one of the clearest ways a vendor can demonstrate that its security controls work consistently, not just during an audit.

AI has added a new layer of complexity. As claims organizations increasingly use AI for tasks like medical record review, fraud detection, and document summarization, auditors are asking more detailed questions about how those tools are managed. They want to understand who approves AI models before they’re deployed, how third-party AI vendors are evaluated, and how employees are trained to use AI responsibly. Simply saying an organization uses an AI vendor is no longer enough. Organizations are expected to show they have governance and oversight in place.

The Cost of Getting it Wrong

The financial impact of a data breach remains significant. IBM’s 2025 Cost of a Data Breach Report found that the global average cost of a breach dropped slightly to $4.44 million, largely because security AI and automation have helped organizations detect incidents faster. In the United States, however, the average cost reached a record $10.22 million.

Breaches involving unauthorized “shadow AI” tools, AI applications used without formal security oversight, increased breach costs by an average of $670,000 and were associated with higher rates of customer data and intellectual property exposure.

In addition, 97% of organizations that experienced an AI-related security incident lacked proper access controls for those systems, and 63% of organizations that suffered a breach did not have formal AI governance policies in place.

For claims organizations evaluating vendors, these findings reinforce that data security today goes beyond traditional access controls. Vendors should also be able to demonstrate how they evaluate, manage, and secure the AI tools supporting their operations.

Final Thoughts

Claims investigations and medical management vendors handle some of the most sensitive personal and medical information in the insurance industry. As AI adoption grows, vendor ecosystems expand, and third-party cyber threats become more sophisticated, protecting that data is more important than ever.

A current SOC 2 Type 2 report remains one of the best ways for a vendor to demonstrate that its security controls have been tested and proven over time. For carriers, TPAs, and employers, that provides greater confidence that sensitive claim and claimant information is being protected every step of the way.

Looking for a partner that takes data security seriously? We are proud to be SOC 2 Type 2 compliant. Contact our team to learn how our secure claims solutions can support your organization.

Check out our sources:

American Institute of Certified Public Accountants & CIMA. “2017 Trust Services Criteria (With Revised Points of Focus – 2022).” AICPA & CIMA, 2022, www.aicpa-cima.com/resources/download/2017-trust-services-criteria-with-revised-points-of-focus-2022.

EY. “To the Point: AICPA Revises Guidance on Applying Its Trust Services Criteria and SOC 2 Description Criteria.” EY, www.ey.com/en_us/technical/accountinglink/to-the-point-aicpa-revises-guidance-on-applying-its-trust-services-criteria-and-soc-2-description-criteria.

IBM. Cost of a Data Breach Report 2025. IBM Security, 2025, www.ibm.com/reports/data-breach.

Verizon. 2026 Data Breach Investigations Report. Verizon, 2026, www.verizon.com/about/news/breach-industry-wide-dbir-finds.