A Fiduciary Liability policy protects your company and the personal assets of fiduciaries for their breaches of fiduciary duties and errors in the administration of your company's benefit plan.
Often this insurance is confused with the following that provides some coverage in connection with employee benefit plans:
  • ERISA Fidelity Bonds are required by law and intended to protect plans against theft or fraud losses. This bond benefits the plan and beneficiaries but does not protect the fiduciary. The bond does not provide any form of payment for legal defenses or damages related to fiduciary claims.
  • Employee Benefits Liability (EBL) protects benefit managers for claims arising out of errors or omissions while administering a benefit plan - enrolling, terminating, or canceling employees under a plan, changing beneficiaries, etc. Such policies cover the typical minor administrative issues that arise.
Protection for fiduciaries is not afforded either by Directors & Officers (D&O) policies as they typically exclude EBL and ERISA related claims.
Your company's risk management program should include adequate fiduciary liability protection regardless of your company size.