As small businesses emerge from pandemic operations and work to evolve, experts caution retirement plan sponsors to allocate time to review the plan design, benefits and services. Participant needs are changing—and plan design options are evolving. Regulations and lawsuits are evolving too—so attend to fiduciary obligations with care.
ERISA Litigation and Smaller Plans
As a retirement plan sponsor, it probably won’t come as a surprise to you that a recent survey found that half of plan sponsors are spending less time on their retirement plans than they would like to. Though understandable, especially given all the disruption of the past year, attention lapses can have scary consequences for retirement plan fiduciaries. Benefits Pro reports:
In the wake of a pandemic that highlighted the importance of being prepared for anything, plan sponsors must approach the coming months with both resiliency and an evolutionary thought process. As if the pressures and disruptions of COVID-19 were not enough, class-action lawsuits targeting 401(k) plans have skyrocketed in just two years, and a new level of regulatory activity is altering environmental, social, governance (ESG) investing, proxy voting and the fiduciary rules.
Experts remind us too, that ERISA lawsuits are increasingly impacting small businesses. Mercer, for example, points out: “The pace of litigation has been astounding, including the tackling of broader issues and litigation moving down market from mega plans to smaller DC plans.”
It’s impossible to predict the legal precedents that will evolve from the swell of ERISA lawsuits currently making their way through the court system. Expanding ERISA fiduciary responsibilities, and the rise in cyber crime contribute to the stressors facing small business owners. Save yourself time—money and worry: secure Colonial Surety’s affordable and comprehensive package for plan sponsors. That way, you’ll know you have:
- The up to date ERISA bond required to protect the assets of the retirement plan from theft;
- Fiduciary Liability coverage to protect you and your assets from personal liability; and,
- Cyber Liability coverage to safeguard your company and plan from covered losses and expenses in the event of a cyber breach.
Colonial Surety makes it so easy and reasonable to secure all this coverage that you can do it now, right here: Complete Sponsor Package Here.
Truly Benefitting Participants?
Of course the goal of retirement plans is to provide benefits to the participants. That’s why experts advice plan sponsors to spend time reviewing participant demographics and current needs vis a vis the retirement plan. Consider the differing needs of both those working to accumulate retirement savings and those approaching retirement. The resulting insights will guide plan sponsors when assessing the best available services and design features for the plan on the go forward. Mercer also advises a: “Sponsors should take a fresh look at DC plans through a lens of diversity, equity and inclusion and consider plan design changes and communications strategies that reflect those findings.”
While you are busy stewarding your company retirement plan forward, don’t forget to protect yourself too. As a retirement plan sponsor, there is always a risk, despite your diligence, that you could face personal exposure for a breach in your fiduciary obligations. With the cost of securing guidance from an expert ERISA attorney averaging about $600—per hour—proactive, self-protection is a must. That’s why Colonial Surety provides affordable fiduciary liability insurance to plan sponsors across the country. With an annual premium that is less then one hour with an expert attorney, you will get peace of mind that your personal assets are protected from a breach of responsibility in the administration or handling of the employee retirement plan.
Colonial Surety Company is in business all across the USA. We are rated “A Excellent” by A.M. Best Company and U.S. Treasury listed.
Serving customers since 1930, Colonial Surety is the trusted source for the pension industry to secure legally required ERISA bonds, fiduciary liability insurance and cyber-liability insurance. We help safeguard plan sponsors, pension professionals and financial advisors – and keep their businesses compliant – with pain-free, efficient, and friendly service every time