Fiduciary Liability Insurance


Definition:

The Fiduciary Liability Policy is designed to cover the responsibility of employers, trustees and professional administrators with respect to errors and omissions in the administration of employee benefit programs as imposed by the Employment Retirement Income Security Act (ERISA). A fiduciary can be anyone who exercises discretionary authority in managing a pension or employee benefit plan, renders investment advice with respect to monies belonging to the plan or has any discretionary authority or responsibility in administering the plan.

What you need to know about Fiduciary Liability Insurance:

  • Any fiduciary that breaches any of the responsibilities, obligations or duties imposed by ERISA may be personally liable to compensate the plan for any resulting losses. 100% of the defense costs can be insured in most cases.

  • Even if your company wishes to indemnify its fiduciaries, it may not be able to do so, or it may be prohibited from doing so by law. Relying on corporate indemnification as your sole protection as a fiduciary may be placing your personal assets at risk.

  • If your company ever reduces or eliminates some employee benefits, or if it plans to be involved in a major merger or to sell part of a business, it dramatically increases its fiduciary liability risk.

  • It is a common misconception that the employee benefits liability (EBL) section of the general liability policy or directors and officers coverage will take care of every possible lawsuit against fiduciaries. EBL protects against claims of errors in plan administration but not against the more expensive and complex ERISA violation claims. Directors and officers liability typically excludes both EBL and breach of ERISA fiduciary duty.


Swingle, Collins & Associates specializes in Fiduciary Liability Insurance coverage in Dallas, Southlake, Westlake, Plano, Coppell, Irving, Argyle and the surrounding areas.  The descriptions of Fiduciary Liability Insurance coverage listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your coverage needs please contact your dedicated risk manager to discuss the benefits and services of commercial inland marine insurance coverage.

The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverage, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.