What’s The Difference Between Fiduciary Liability And An ERISA/Fidelity Bond?
ERISA/Fidelity bonds are required by law. ERISA requires a minimum bond of 10% of the assets in the Plan(s) be in place during the term of the Plan. This is a form of insurance for dishonesty situations. When dishonest administrators or trustees have financially harmed an employee benefit plan, these bonds may be used, but only for the benefit of the plan and the plan’s beneficiaries. This bonding insurance will not protect the trustees themselves from liability claims and is thus completely distinct from fiduciary liability insurance.
