Fiduciary Liability vs. Fidelity Bond: What Is the Difference?
A fidelity bond generally protects against covered dishonest handling losses; fiduciary liability insurance responds to certain claims alleging breaches of benefit-plan duties. Confirm the bond’s named insured and the liability policy’s insureds.
The phrase “fidelity bond” can describe different products. For ERISA purposes, DOL says the required bond protects the plan from loss caused by fraud or dishonesty by covered persons who handle plan money or property. It does not insure fiduciaries against all liability for how they manage the plan. A fiduciary policy addresses covered allegations of breach, subject to its terms.
Check the bond’s scope, plan-as-protected-party language, covered handlers, limit, and any applicable exemption; a commercial crime policy may not automatically meet ERISA’s requirements. Separately inspect fiduciary policy definitions, claim timing, limits, exclusions, and defense-cost structure. If the quote offers a “fidelity” product, ask the agent to identify in writing whether it is an ERISA bond, crime insurance, or both and which risk each contract addresses.
Related Coverage
Providers That List This Coverage
Sources
- Field Assistance Bulletin No. 2008-04: Guidance Regarding ERISA Fidelity Bonding Requirements. U.S. Department of Labor, Employee Benefits Security Administration; Q2 pp.2–3. Accessed 2026-09-25.
- Fiduciary Liability. Travelers Casualty and Surety Company of America; II.D,J–L pp.2–3; II.A p.1; II.V p.5; Header p.1; II.M p.3; III.A.6–8 pp.5–6; II.M.2 p.3; III.B.1 p.6. Accessed 2026-09-25.
- Management and Professional Liability Insurance. Travelers; Select a product: D&O, EPL, ERISA fidelity insurance and fiduciary liability insurance. Accessed 2026-09-25.
