Fiduciary Liability Insurance

Fiduciary liability insurance protects multiemployer plans and trustees against lawsuits alleging a breach of fiduciary duty as well as against administrative errors or omissions. This insurance pays for defense costs and for settlements and judgments up to the policy limits.

It is important to review the policy and its limits on a regular basis to make sure coverage is in line with a number of factors not the least of which is recent lawsuits and judgments.

What about personal assets of the trustees?

An additional waiver of recourse rider, which must be paid for with non-plan assets, ensures that trustees' personal assets are also protected from any losses.

What other kinds of coverage are included in a fiduciary liability policy?

In recent years, each carrier has included new coverages, including:

  • IRS Employee Plans Compliance Resolution System (EPCRS) extended to include the DOL and, in some policies, defense costs
  • New coverages and/or increased sublimits for some fines and penalties 
  • Legal monitoring costs associated with a DOL pre-claim investigation
  • Affirmative coverage subject to a claim of benefit overpayments
  • Legal expenses associated with an interview by an Enforcement Unit other than the DOL or PBGC
  • A sublimit for expenses associated with an E-Discovery

The approach varies with each carrier, and the differences can be significant. Understanding what each policy includes and excludes is important.

Should I review my current policy’s coverage and limits?

The DOL has become more aggressive in scheduling plan audits and pursuing items it finds questionable. In addition, claims are becoming more frequent, and the severity of judgments is increasing. A policy put in place as few as five years ago may not offer the protection needed today.

Segal Select offers a free policy review.

Are you a new trustee or new to coverage?

Watch our Fiduciary Liability 101 video below to learn the basics of this important coverage.


Have you reviewed your policy coverage and limits lately?

Segal Select’s complimentary policy review includes basic coverage and costs benchmarking.



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