What Insurance Covers Breach Of Fiduciary Duty?
Fiduciary liability insurance covers breach-of-duty claims over employee benefit plans; D&O insurance covers breach-of-duty claims over running the company.
Which policy covers a breach of fiduciary duty depends on whose money you were managing. If the claim involves an employee benefit plan such as a 401(k), fiduciary liability insurance responds. If it involves your management of the company, directors and officers (D&O) insurance responds.
Each policy usually excludes claims meant for the other, so buying only one can leave a gap. If you sponsor a benefit plan, you need both.
When you compare quotes, check which plans and fiduciaries are covered, how benefits-owed claims are treated, whether defense costs reduce the limit, and the reporting terms.
