Aon  |  Financial Services Group
Fiduciary Liability

Individuals with discretionary authority for the management or administration of an employee benefit plan subject to the Employee Retirement Income Security Act (ERISA) or who exercise authority or control in managing or disposing of its assets are fiduciaries of that plan. Under ERISA, plan fiduciaries are personally liable for fiduciary failures, meaning their personal assets could potentially be at risk. In a worst-case scenario, even bankruptcy does not offer protection to fiduciaries.

Fiduciary liability insurance protects:


  • The company/plan sponsor organization and its subsidiaries
  • Covered plans, including:
    • Qualified plans (e.g., welfare plans addressing medical, dental, life insurance, disability and accident, and pension plans providing defined benefit and defined contribution)
    • Non-qualified plans (e.g., deferred compensation programs, supplemental executive retirement programs and top-hat plans)
  • Insured persons (i.e., any natural person serving as a past, present, or future director, officer, partner, or employee of the sponsor organization or a plan, in his/her capacity as a fiduciary, administrator or trustee of a plan)

Claims addressed by fiduciary liability insurance include:


  • Breaches of fiduciary duty, including violations of fiduciary obligations, responsibilities, or duties under ERISA and similar laws worldwide (where permissible)
  • Administration, including acts, errors, or omissions in the administration of a plan, such as:
    • Advising, counseling, or giving notice to employees, participants, and beneficiaries
    • Providing interpretations
    • Handling records
    • Activities affecting enrollment, termination, or cancellation of employees, participants, and beneficiaries under the plan
  • Actions taken in a settlor capacity


Featured Insight

What Drives Fiduciary Liability?

Aon surveyed 12 top carriers for fiduciary liability insurance to understand their views on the biggest sources of fiduciary risk within the control of fiduciaries for defined benefit (DB) and defined contribution (DC) plans subject to ERISA. Read our client alert to learn more about the key takeaways from the results.

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Featured Insight

The Intersection of Fiduciary Liability, Cybersecurity and Data Privacy Risk

The issue of cybersecurity risk has long had the potential for impacting the fiduciary liability space. Recent litigation filed by plan participants against plan sponsors and their third-party service providers has turned that potential into reality. Such litigation includes allegations that the defendants breached their respective fiduciary duties by failing to ensure adequate cybersecurity measures.

Click here to learn more