"Encryption is the process of obfuscating data by the use of a key or password. This can make the data useless without the corresponding decryption key or password. Encryption does not solve access control problems. However, it enhances security by limiting data loss even if access controls are bypassed. For example, if the database host computer is misconfigured and a hacker obtains sensitive data, that stolen information might be useless if it is encrypted.
You can use encryption in SQL Server for connections, data, and stored procedures. The following table contains more information about encryption in SQL Server.
Although encryption is a valuable tool to help ensure security, it should not be considered for all data or connections. When you are deciding whether to implement encryption, consider how users will access data. If users access data over a public network, data encryption might be required to increase security. However, if all access involves a secure intranet configuration, encryption might not be required. Any use of encryption should also include a maintenance strategy for passwords, keys, and certificates."