Data classification
In one sentence
Sorting your data by sensitivity (public, internal, confidential) so the most important gets the most protection.
Data classification labels information by how damaging its exposure would be, so you can apply stronger controls (access limits, encryption, retention rules) to the confidential material and not waste effort on the rest.
Why it's on your cyber insurance application
Applications ask what sensitive data you hold and roughly how many records. That question is unanswerable without having thought about where the sensitive material lives, and a vague answer tends to produce a conservative premium.
What this looks like in practice
You don't need a labeling scheme with four tiers. You need to be able to say which folders hold the material that would actually hurt if it leaked: client files, payroll, patient records, card data. Write that down, then make sure access to those folders is limited to the people who need them.
The written evidence carriers accept
A “yes” on the application needs a document behind it. In the Readiness Pack, that document is:
Related terms
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