We explore how claims-based identity strengthens modern IAM. Learn how cloud-first strategies, passwordless authentication, updated protocols, and evolving providers help organizations secure APIs, mobile apps, and high-risk environments against today’s advanced threats.

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In brief:

• Claims-based identity provides dynamic, continuous verification. Unlike older role-based systems that rely on static credentials, claims-based authentication checks multiple attributes in real time, making stolen tokens useless to attackers.
• Modern cloud and API environments demand flexible authentication. Traditional on-premises IAM can’t secure today’s distributed, multicloud ecosystems where apps rely on APIs and microservices to function.
• Passwordless authentication integrates seamlessly as a claim. With 46 percent of Americans reporting stolen passwords in 2024, modern standards like FIDO2 and passkeys work naturally within claims-based systems without complex infrastructure changes.
• Compliance standards require contextual, continuous authorization. Regulations like GDPR, HIPAA and CISA certification align with claims-based systems that document MFA access and provide ongoing verification.
• Human oversight remains critical to IAM security. You must pair strong technical tools with just-in-time access, manager-approved requests, user education, and behavioral analytics to create truly effective security.

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Until recently, hacking into an online resource was as easy as stealing a key to a lock. A lock doesn’t know who’s holding the key as the keyholder inserts and turns it. Whether the keyholder is the rightful owner or a thief, the keyholder has full access. For hackers, older identity and access management (IAM) systems were just as easy. For example, hackers could steal a session cookie from a computer’s browser or memory, load it into their own browser, and use it to connect. Since the server had no way to determine who was “holding the key,” attackers could continue the session under the legitimate user’s identity. Fortunately, thanks to updated IAM tools, such as claims-based authentication, times have changed. Claims-based authentication is more secure because it checks who’s “holding the key.” But it’s also more flexible than previous IAM tools, making it a robust defense for application programming interfaces (APIs), mobile apps, and highly sensitive environments.

What Is Claims-Based Authentication?

Claims-based authentication is an IAM method that passes identity information from an identity provider (IdP) to an application to verify the user’s legitimacy. The identity information is what the system is “claiming” about the user. The application is also known as the relying party because it relies on the information in the claim to authenticate the user. Claims-based authentication works using security tokens. These tokens contain the claims, which may include:

• The user’s username
• The user’s email address
• The device’s IP address
• Multifactor authentication (MFA) status
• The user’s role
• Other custom attributes, such as the user’s department or clearance level

The app checks the security token and, if it contains the appropriate claims, grants the user access. In addition, a claims-based authorization system can also continually check claims in real time. So if any information changes, the app can revoke the user’s access. If, for example, an attacker were to try stealing a security token, it wouldn’t work on their computer because it would have a different IP address.

How Claims-Based Authentication Works, Step by Step

Claims-based authentication has three basic steps:

1. The identity provider (IdP) authenticates each user using a desired method, such as a password-free ID verification, an emailed or texted code, MFA status, or a passkey.
2. The IdP creates a token using a tool such as a JSON Web Token (JWT) or the Security Assertion Markup Language (SAML). The token contains the claims about the user.
3. The app (relying party) validates the token and either grants or denies the user access.

Claims-Based vs. Role-Based Authentication

Role-based authentication grants access using static, predefined roles, whereas claims-based authorization uses dynamic attributes, making it more difficult for a hacker to gain access. For instance, older, role-based authentication could use a username, password and the user’s “admin” status to grant access. A hacker could simply grab an admin’s laptop in a coffee shop and gain access to a sensitive area of a web app. But with claims-based authentication, the system may also check the device’s geolocation and the network IP address used to log in. If the attacker moves a specific distance outside the acceptable geolocation range, they could be denied access until they verify their identity by entering a code sent to the real user’s mobile device. Also, the claims-based system can deny the hacker access because they use a network different from the real user’s. For example, if they take the laptop home, the claims-based system can deny them access because the laptop’s IP address differs from the one the legitimate user uses at work, the coffee shop, or at home. The system could send a verification code to the user’s password-protected mobile device, but because the attacker couldn’t receive it, their hack would be foiled.

Modern IAM Challenges That Claims-Based Identity Mitigates

Years ago, organizations often stored their sensitive data in on-premises databases and hosted their business-critical apps in on-premises servers. That made authentication relatively straightforward because information technology (IT) teams only had to control access in that local, somewhat insulated environment. Modern token-centric architectures introduce novel threats, primarily because a successful theft can give hackers access to multiple systems or data assets. Some of the more common challenges include:

• Token theft, which hackers execute by scraping memory or exfiltrating token data stored in users’ browsers
• Replay attacks, which occur when attackers steal tokens and use them in other systems
• Weak certificate-based authentication, which stems from certificates with long lifetimes or misconfigurations
• Session fixation, which occurs when an attacker forces a known session ID on a user before they log in. That way, the attacker can use the same session ID to gain illicit access.
• API-specific risks arising from poor token rotation and insecure token storage on mobile or Internet of Things (IoT) devices

Modern computing ecosystems are more complex because they use cloud, multicloud and hybrid environments. Fortunately, claims-based tools can mitigate many of the issues posed by modern environments, specifically by providing:

• Continuous and contextual authorization using dynamic claims, such as risk scores based on a combination of multiple factors
• Fine-grained API scopes, which prevent overpermissioning by enabling teams to associate users with highly detailed claims credentials
• Centralized identity governance across cloud ecosystems fosters consistently high standards and avoids compliance issues around an organization’s IAM systems

3 Key Areas Claims-Based Authentication Supports

Here are a few areas claims-based authentication supports:

1. Cloud-First and API-First Adoption

Modern organizations may use cloud architectures existing in multiple public or private clouds. Companies also use microservices, which can be distributed, to build their apps. As a result, many apps rely on APIs to function, and APIs can’t be securely authenticated using traditional IAM or on-premises methods. However, claims-based identity supports:

• Headless identity, ideal for mobile apps that are often “headless,” meaning the user interface is decoupled from the back end
• Short-lived tokens that are only valid for a few minutes or less
• Interoperability across several providers. For instance, a single claims-based authentication system can work for an organization that uses Microsoft Entra ID (formerly Azure AD), Amazon Web Services (AWS), and Google Cloud Identity services.

2. Passwordless and Phishing-Resistant Requirements

Passwordless and phishing-resistant measures work well with claims-based authentication because you can include them in the set of claims that must be verified. In years past, using shared secrets — such as passwords, API keys and tokens — introduced dangerous vulnerabilities because anyone with them could gain access. That’s part of the reason that 46 percent of Americans reported having their password stolen in 2024. But authentication tools like FIDO2, platform-based authenticators, and passkeys provide more secure ways to verify that people are who they claim to be. While these can be difficult to integrate into traditional IAM solutions, they work well with claims-based systems because the identity provider can simply include the passwordless or phishing-resistant authentication method, such as FIDO2, as a claim. There’s no need to incorporate complex authentication logic into an app’s infrastructure because a claims-based authorization service can handle authentication.

3. Compliance and Regulatory Drivers

Compliance standards — such as the European Union’s General Data Protection Regulation (GDPR) and the U.S.’s Health Insurance Portability and Accountability Act (HIPAA) — force organizations to use authorization methods that align with claims-based systems. For instance, documenting MFA access and token-based access attempts is straightforward with a claims-based identity solution. Because of the highly sensitive nature of many organizations’ data, they must provide contextual, continuous authorization to meet compliance standards. With older IAM systems, such approval would be difficult, but because claims-based authorization provides continuous, contextual verification, it is well-suited to compliance-sensitive companies.

Claims-Based Protocols and Standards

Traditional protocols, which may lack the security or flexibility of modern standards, include:

• SAML 2.0. An enterprise single sign-on (SSO) service is often used in a business-to-business (B2B) context.
• WS-Federation or WS-Trust. Used little today. WS-Federation and WS-Trust usage has been discouraged across many industries.
• Still widely used because it can authorize APIs and web and mobile apps, OAuth has vulnerabilities, such as tokens being exposed in browser histories or logs.
• OpenID Connect (OIDC). An authentication layer on top of OAuth 2.0 that still relies on client secrets, which, if intercepted or shared, can compromise security.

Modern Standards

Recent updates and emerging standards have strengthened claims-based identity:

• JWT (JSON Web Tokens). JWT is commonly used with modern apps. It supports richer claims, is mobile-friendly, and provides short-lived tokens. In today’s environments, JWT is popular because JSON is ubiquitous in programming.
• PASETO is a newer, more secure token format that addresses some JWT pitfalls, such as its vulnerability to weak algorithms. Modern organizations use PASETO to keep hacked algorithms from infiltrating their authentication systems.
• FIDO2 and WebAuthn. This is the modern standard for passwordless, phishing-resistant authentication. In today’s environment, it is replacing token exchanging, which relies on transferable bearer tokens that can be stolen or intercepted and reused by attackers.
• Token Binding (TLS Channel Binding). Token binding helps prevent token replay by binding tokens to a specific Transport Layer Security (TLS) session. If an attacker tries to launch a new session, the system will deny them access, which makes it a good fit for today’s TLS-protected data transfers.

Identity Providers

Modern IAM is dominated by cloud-native IdPs that seamlessly support claims-based identity, including:

• Microsoft Entra ID (formerly Azure AD)
• AWS IAM Identity Center
• Google Cloud Identity
• Okta/Auth0
• Ping Identity/ForgeRock

For business-to-consumer (B2C) and large-scale consumer apps, claims-based identity integrates directly with:

• Apple Sign-In
• Google Sign-In
• Microsoft Consumer Accounts
• Facebook Login
• Passkey-based ecosystem authentication

The Crucial Role Humans Play in IAM Security

Getting the right technical tools is only half the battle. An effective claims-based IAM system needs humans to take a leading role, particularly when it comes to:

• Incorporating just-in-time access privileges. By providing access immediately before a user needs it, an organization shrinks the window of time a hacker has to try to steal credentials.
• Addressing self-service access issues. For instance, by routing self-service access requests through the user’s manager or the resource owner, you can drastically reduce the risk of a hacker exploiting the system.
• Educating users and managers around organizational policies. This teaches them when to request access rather than waiting for provisioning, why sharing credentials is dangerous, and how to recognize abnormal access requests.
• Using continuous access certifications. Continuous access certifications can detect role changes, newly privileged accounts and other risky conditions.
• Using attestation workflows. An attestation workflow can ensure managers regularly confirm legitimate access, verify justification, and automatically revoke access if access conditions aren’t checked in time.
• Incorporating behavioral analytics for access. Behavioral analytics can check login location, time and the apps used to connect. It can also identify anomalies, such as unusually high download volumes or unexpected privilege escalation.

Creating a rock-solid system depends on a combination of people and processes, not just strong tech.

Claims-Based Authentication: A Pillar of Modern IAM

Claims-based authentication is ideal for modern ecosystems that depend on cloud assets and app architectures dominated by microservices and APIs. They replace role-based authentication systems that were plagued by static credentials, which made them relatively easy to hack. Modern, adaptable claims-based tools can stop many token-based attacks by allowing the app to verify who’s “holding the key” rather than opening its doors to just anyone with the proper static credentials. [cta bg="blue" button="Download the Playbook" link="https://centricconsulting.com/resources/cyber-expertise-at-scale-your-playbook-for-scoring-an-all-star-team_cyber/"]Build a resilient cyber team with the right mix of internal talent and external expertise — without the burnout or blown-out budget.[/cta]

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