Retirement plan sponsors are beginning to see more claims involving the alleged wrongful use of personal information belonging to retirement plan participants claimed to be “plan assets”.
The specifics of these allegations is that employers breach fiduciary duties of prudence and loyalty when they let plan service providers profit from the utilization of plan assets, sensitive personal information of plan participants, for non-plan usage. Thankfully, there are some tactics plan sponsors can use to minimize the risk of these sort of claims. One is to consider relationships with plan sponsor service providers more thoughtfully and sooner in the process. You can also reduce by contract the ability of service providers to utilize plan participant data to sell or market to plan participant products dissimilar to the retirement plan, unless the participants consents or initiates.
Plan sponsors must ensure they have the proper guidance in place at all times. This includes acquiring an ERISA fidelity bond for their company’s employee benefit plan. Our ERISA bonds are available for instant quote and purchase. We also include Fiduciary Liability Insurance and Cyber Liability Insurance in our 2 and 3-year ERISA bond packages. Fiduciary Liability Insurance protects the fiduciary against claims of actual or alleged breaches of duty, while Cyber Liability Insurance, which only comes with the ERISA bond package, helps you adeptly respond to a data breach. Contact us today to purchase your bond.