ISC2 CC Security Principles Practice Question
An organization labels data as 'Confidential' and requires encryption both at rest and in transit. This classification is an example of:
⚠ Common exam trap
The CC exam often tests whether candidates confuse data classification (labeling by sensitivity) with adjacent governance concepts like retention, due care, or risk transfer — the keyword 'labels' or 'classification levels' points to classification.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Data classification
Labeling data as 'Confidential' with handling requirements like encryption at rest and in transit is the definition of data classification — assigning sensitivity levels that drive protective controls. Classification is the foundational step that determines which encryption, access, and retention policies apply.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
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Risk transfer
Why it's wrong here
Risk transfer shifts financial loss to a third party, typically via insurance or outsourcing; labelling data 'Confidential' and mandating encryption is classification, which reduces risk rather than transferring it. Risk transfer is tempting because it is a recognised risk-treatment option, and would be correct if the stem described purchasing cyber insurance.
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Due care
Why it's wrong here
Due care is the ongoing diligence an organisation exercises, not the labelling scheme itself; the stem's 'Confidential' tag with encryption rules is data classification. Due care is tempting because it underpins security governance, and would be the answer if asked what obligation drives protecting assets.
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Data classification
Why this is correct
Assigning the 'Confidential' label is itself the act of categorising data by sensitivity, which is data classification. Encryption at rest and in transit are the handling controls that the classification drives, not the classification itself, so the label satisfies the scenario's requirement.
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Data retention
Why it's wrong here
Data retention governs how long records are kept and when they are destroyed, whereas the stem describes assigning a sensitivity label with encryption controls — data classification. Retention is tempting because both are data-handling policies, and would be correct if the question asked about storage duration or disposal schedules.
Go deeper
Related to this question
Key term
Data classification
Data classification is the process of organizing data into categories based on its sensitivity, value, and criticality to an organization, so that appropriate security controls can be applied.
Key term
Encryption
Encryption is the process of converting readable data into a secret code to prevent unauthorized access.
About these practice questions
One of 989 original CC practice questions on Courseiva, each with a full explanation and wrong-answer analysis — not exam dumps or protected exam content. Learn why practice questions differ from exam dumps →
JA
Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official ISC2 exam blueprint
This CC practice question is part of Courseiva's free ISC2 certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CC exam.