More Fiduciaries, More Litigation Exposure for Plan Sponsors. Increasingly, retirement plan sponsors are being sued by plan participants and/or investigated by the DOL for breach of fiduciary duty under the Employee Retirement Income Security Act of 1974 (ERISA). Case law—and the courts’ interpretations of the law—are changing and expanding every day, and indemnification agreements may not hold up in the future. Gaps in traditional plan coverage are not only significant, but they’re also not obvious to plan sponsor clients. It’s these gaps that Fiduciary Liability Insurance seeks to fill.
Fiduciary Liability Insurance (FLI) offers a practical way to help protect plan sponsors and their employees against fiduciary-related claims. FLI is designed to help financially protect against claims of fiduciary breach under ERISA. It can be issued to fiduciaries, plans, or plan sponsor organizations and can provide protection from enterprise risk. Plan sponsors may be able to simply add it to existing policies through their current insurance provider.
