Who Needs Fiduciary Liability Insurance?

An organization that sponsors a retirement or health plan may have fiduciary responsibilities, and individuals or committees with discretion over plan administration or assets may have them too. DOL explains that functional responsibilities—not a title—determine fiduciary status, and some service providers doing only ministerial work are not fiduciaries on that basis alone. Fiduciaries can be personally responsible for certain losses resulting from a breach.

Insurance does not erase those duties, and neither every employer nor every person connected to a plan is automatically an insured under a policy. Consider the plans you sponsor, who makes investment and eligibility decisions, which tasks are delegated, and how providers are monitored. Then compare those facts with the quote’s definitions of insured person, organization and employee benefit plan, including subsidiaries, new plans and acquired plans. Ask whether the broker has scheduled every relevant plan and role.