The answer is to enable the 'Remediation' setting for each policy assignment in the custom initiative. This works because Azure Policy, which underpins custom compliance initiatives in Defender for Cloud, uses a managed identity assigned to the policy to automatically deploy the required encryption configurations—such as enabling encryption on storage accounts or SQL databases—when a resource is found non-compliant, creating a remediation task that runs without manual intervention. On the AZ-500 exam, this tests your understanding of how Defender for Cloud integrates with Azure Policy’s enforcement capabilities, often appearing as a distractor where candidates mistakenly choose Azure Automation runbooks or manual compliance scans. A common trap is assuming you need a separate tool like Logic Apps, but the built-in remediation task on the policy assignment itself handles the automatic fix. Memory tip: think "Policy + Remediation = Auto-fix" to remember that the remediation toggle on each policy assignment is the key to hands-off compliance enforcement.
AZ-500 Manage identity and access Practice Question
This AZ-500 practice question tests your understanding of manage identity and access. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A company uses Microsoft Defender for Cloud. They have assigned a custom regulatory compliance initiative that includes policies to enforce encryption on storage accounts and SQL databases. They want to automatically remediate any non-compliant resources that are discovered, without manual intervention. Which feature should they configure?
Enable 'Auto provisioning' for the relevant extensions
Why wrong: Auto provisioning installs agents, but does not automatically fix non-compliant resources like encryption settings.
B
Enable 'Remediation' for each policy assignment in the custom initiative
When you assign a policy with 'DeployIfNotExists' effect, you can enable remediation to automatically create and run remediation tasks to fix non-compliant resources.
C
Enable 'Just-in-time (JIT) VM access'
Why wrong: JIT manages network access, not policy compliance.
D
Enable 'Workflow automation' to trigger a Logic App when non-compliance is detected
Why wrong: This triggers a manual or automated process, but does not automatically remediate like the built-in remediation feature.
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Enable 'Remediation' for each policy assignment in the custom initiative
Option B is correct because the 'Remediation' setting on a policy assignment in Azure Policy (used by Defender for Cloud custom initiatives) creates a managed identity and a remediation task that automatically applies the required encryption configuration to non-compliant resources. This ensures that when a storage account or SQL database is found without encryption, the policy engine triggers a deployment to enforce encryption without manual intervention.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✗
Enable 'Auto provisioning' for the relevant extensions
Why it's wrong here
Auto provisioning installs agents, but does not automatically fix non-compliant resources like encryption settings.
✓
Enable 'Remediation' for each policy assignment in the custom initiative
Why this is correct
When you assign a policy with 'DeployIfNotExists' effect, you can enable remediation to automatically create and run remediation tasks to fix non-compliant resources.
Related concept
Read the scenario before looking for a memorised answer.
✗
Enable 'Just-in-time (JIT) VM access'
Why it's wrong here
JIT manages network access, not policy compliance.
✗
Enable 'Workflow automation' to trigger a Logic App when non-compliance is detected
Why it's wrong here
This triggers a manual or automated process, but does not automatically remediate like the built-in remediation feature.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates confuse 'Auto provisioning' (which installs agents for data collection) with automatic remediation of compliance policies, or they assume 'Workflow automation' directly fixes non-compliance when it only triggers a notification or custom action.
Detailed technical explanation
How to think about this question
Under the hood, the 'Remediation' feature in Azure Policy uses a 'deployIfNotExists' or 'modify' effect combined with a system-assigned managed identity that has the necessary permissions (e.g., Contributor on the resource group) to apply encryption settings. When a policy evaluation finds a non-compliant resource, the remediation task runs a deployment template that enables encryption (e.g., setting 'encryption.enabled' to true on a storage account or enabling Transparent Data Encryption on a SQL database). This is distinct from 'Auto provisioning' which only handles agent deployment, and from 'Workflow automation' which requires a separate Logic App to implement remediation logic.
KKey Concepts to Remember
Read the scenario before looking for a memorised answer.
Find the constraint that changes the correct option.
Eliminate answers that are true in general but not in this case.
TExam Day Tips
→Watch for words such as best, first, most likely and least administrative effort.
→Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A media company stores terabytes of video archives that are accessed once a year for audit purposes. Moving these objects to a cold storage tier (Azure Archive, S3 Glacier, or Google Nearline) costs a fraction of hot storage. Questions like this test whether you understand storage tiers, access frequency tradeoffs, and retrieval latency requirements.
Related glossary terms
Concepts from this question explained
These glossary pages explain the core terms tested in this AZ-500 question in full detail.
Manage identity and access — This question tests Manage identity and access — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Enable 'Remediation' for each policy assignment in the custom initiative — Option B is correct because the 'Remediation' setting on a policy assignment in Azure Policy (used by Defender for Cloud custom initiatives) creates a managed identity and a remediation task that automatically applies the required encryption configuration to non-compliant resources. This ensures that when a storage account or SQL database is found without encryption, the policy engine triggers a deployment to enforce encryption without manual intervention.
What should I do if I get this AZ-500 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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