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Best Reviews > Password Managers Reviews > Articles > How Password Managers Keep Data Safe in a Breach

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How Password Managers Keep Data Safe in a Breach

By Richárd Z. Verified by Sharmaine G.
Last updated: March 10, 2023

How Password Managers Keep Data Safe in a Breach With data breaches affecting both small and big businesses, every company must take its password protection seriously. This is because cybersecurity starts with good password hygiene, which includes unique and complex passwords for all accounts.

However, passwords that are hard to guess can still land in the hands of malicious actors. As such, using a password manager is the most straightforward solution to keep them safe.

Unfortunately, these programs aren’t hackerproof either. For one, a skilled cybercriminal can scrap the software’s source code and technical information. Hacks can also occur if a device is infected by malware, which can take place during a software update. In fact, Passwordstate suffered from such an incident back in 2021.


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On a positive note, it’s worth highlighting that a password manager breach doesn’t usually compromise users’ data. In other words, the software can still protect you after its system has been hacked.

The Dangers of Breached Password Managers

A data breach happens when an unauthorized person gets access to confidential or sensitive information. It’s important to understand that individuals and big corporate firms have equal chances of getting hacked. That’s because cybercriminals don’t differentiate between victims as long as they can steal valuable data. Of course, the damage done is usually higher when hackers target companies, as they’re able to gain information of thousands of individuals in one go.

There are two types of weaknesses that cybercriminals exploit in order to obtain information they aren’t supposed to have: technology and user behavior. Depending on the situation, the hacker will attempt different methods, such as phishing, brute force attacks, malware, and social engineering, just to name a few.

With over 45 million Americans using password managers, it seems people are definitely taking online security seriously. But what happens if the password manager itself is breached?

The consequences can be quite dire. This is mainly because it can take weeks to discover a breach, during which period the hacker can hijack online accounts and take note of personal information. In the case of a business, cybercriminals may steal financial data and customer details.

Unfortunately, there seems to be no stopping hackers from trying to break into everything, including password managers. The 2022 breach on LastPass is an infamous example of that. On the flip side, numerous renowned platforms such as Keeper have never been breached, meaning that using a password manager still offers high cybersecurity.

Ways a Password Manager Protects Users in a Data Breach

Password managers implement numerous ways to protect data. For example, these programs follow a zero-knowledge architecture where credentials are only known by the user.

This means that no one else but you has access to data stored in your vault, and only you know the master password. Companies like 1Password take this a step further by introducing an additional secret key, which is necessary to log into your account in a new device or to reset your master password.

As an extra security step, password managers usually require authentication when setting them up on new devices. This prevents unauthorized software access in the event that someone manages to guess the user’s master password. To give an example, Dashlane sends a one-time passcode (OTP) via email or phone and unlocks only when users enter this code.

Alternatively, multifactor authentication can be enabled, so that an OTP is sent every time you log in to the software. This can include the use of biometrics and an authenticator app, not just email or SMS.

Best Practices of Using a Password Manager

Good password hygiene is always vital. Therefore, everyone must create strong and unique passwords and only use the same one once. A password of at least 12 characters long with small and capital letters, numbers, symbols, and punctuation marks takes lifetimes to crack.

A password manager makes generating such passwords a walk in the park. It creates complex ones without effort, which are automatically stored in your secure vault. These passwords can then be accessed whenever needed, so you don’t necessarily have to remember them.

However, even the best password manager can be vulnerable if not updated when the relevant notification pops up. Just like any software, these programs get an update when a bug is fixed. In this case, these bugs might be loopholes in the software’s code that cybercriminals can exploit.

Steps To Take if a Password Manager Is Breached

We all know the saying: it’s better to be safe than sorry. Therefore, although password managers protect users after a breach, it’s best to introduce a few additional security measures when the software has been breached. The first and most essential step is to reset and change the master password.

Beyond that, changing the credentials for the most used accounts can be worthwhile, which only takes a few seconds to do with the software. Another important step is to enable multifactor authentication via an authenticator app or biometrics instead of SMS.

Using additional security can also make a big difference. For example, dark web monitoring tools can easily find out if any piece of your data has been leaked. Websites like Have I Been Pwned reveal if the dark web has information on you, but numerous password managers also offer this feature.

Furthermore, identity theft protection services can come in handy when you already suspect that a breach has occurred. For example, if you store credit card details in your password manager vault and notice unexpected bank transactions, there’s a high chance of identity theft occurring.

Finally, it’s worth preparing a breach response plan that involves being able to detect the key signs of a breach, such as login notification emails. By doing so, you can act quickly if another cyberattack happens and protect yourself from further harm.

For all intents and purposes, a password manager breach isn’t the end of the world. The software can still protect your vault even when hacked, so you shouldn’t delete it right away. That being said, it’s essential to understand thoroughly how your service protects your data and change to a more secure option if necessary.

Best Password Managers of 2023

RankProviderInfoVisit
1
Editor's Choice 2023
RoboForm
  • Simple and straightforward client
  • Categorization of stored credentials
  • Biometric authentication
  • Versatile customer service
  • Review:
Visit RoboForm50% Off
2
NordPass
  • Strong security features
  • Password generator
  • Excellent free-forever version
  • Attractive price
  • Review:
Visit
3
Keeper
  • Fantastic security
  • Flexible platform
  • Reasonably priced
  • Easy-to-use
  • Review:
Visit

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