Retirement plan advisers find that for the most part, plan sponsors are knowledgeable about the investment lineup and meet Department of Labor filing deadlines. However, plan advisers encourage plan sponsors to advance their understanding of fiduciary responsibilities
ERISA obligations are among the highest known to law. Pension industry experts observe that plan sponsors are often unaware that even when they delegate some of their duties, they retain fiduciary responsibility. Plan Sponsor shares this expert advice:
“The No. 1 thing is being aware of their role as a fiduciary,” says Craig Eissler, a wealth adviser with Halbert Hargrove. “Many plan administrators may believe that hiring advisers and third-party administrators [TPAs] will entirely divest them of all liability and decision making.”
But plan sponsors “inherently act as stewards [that] create the retirement plan,” he continues. “The investment committee members are charged with overseeing the portfolio, and other administrators are involved in ensuring the plan runs smoothly. Even with the use of service professionals, plan sponsor fiduciaries are still responsible for showing prudence in the active management of the plan.”
Whether you are new to plan sponsorship or have years of experience under your belt, it’s a good idea to brush up on your fiduciary responsibilities or even participate in a training workshop. With regulations and guidelines shifting and increasing, you don’t want to fall behind. Remember, ff you face an allegation of a fiduciary breach, ERISA law won’t care why you erred. It’s also important to secure protection for your personal assets, in the event you face an allegation of a fiduciary breach. Even defending yourself from an allegation could lead to deplete your savings: the cost of securing guidance from an expert ERISA attorney averages about $600—per hour.
Obtain Colonial Surety’s affordable fiduciary liability insurance today. Then you will be covered for defense costs and penalty limits up to $1,000,000. With an annual premium that is less than 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. At Colonial, it is so quick, easy and affordable to obtain coverage, you can do it right now: Fiduciary Liability for Plan Sponsors Here.
Periodic Review—and Documentation Too
Industry experts encourage plan sponsors o actively participate in periodic reviews with their advisors, and recordkeepers—and listen carefully to updates on legislation and regulations:
In sum, Eissler says, “When you step back and review all that’s involved in establishing, managing and monitoring a qualified plan, it’s little wonder that there’s such a critical need for experienced, trained retirement professionals. While there are a multitude of common mistakes made when administering a plan, at a high level, implementing an ongoing review process is a critical best practice that would serve sponsors well. This would include mapping out review meetings, maintaining minutes, documenting retirement plan management decisions and regular review of investment policy statements [IPSs], as well as continuous monitoring of provider fees and services.”
The Department of Labor (DOL) has been active with audits this year and wants to ensure that plan sponsors are implementing the detailed protocols for cybersecurity. An important practical step for plan sponsors is ensuring a timely and expert response plan for cyber breaches in their companies. You can do this quickly, and affordably with Colonial Surety Company: Cyber Liability Insurance for Plan Sponsors. Colonial’s services-based cyber liability coverage provides plan sponsors with assistance at every stage of incident investigation and breach response. Our cyber breach professionals coordinate carefully vetted forensics experts and specialized lawyers to help plan sponsors determine what’s been compromised, and provide:
- Breach resolution and mitigation services
- Computer expert services
- Legal services
- Public relations and crisis management expenses
- Customer notification services
- Call center services
In just a few minutes you can affordably obtain Cyber Liability Insurance—and Fiduciary Liability Insurance from Colonial Surety. Our comprehensive packages provide: the 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 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.