Overseeing recordkeepers, TPAs, and advisers; proving fees reasonable; and insuring the plan and its fiduciaries.
Selection demands a documented comparison — services, fees, technology, references — typically via RFP for recordkeepers. Monitoring means annual performance and fee reviews, error tracking, cybersecurity checks, and a fresh market test every three to five years, all recorded in committee minutes.
Read the full answerERISA permits paying plan service providers only reasonable compensation for necessary services. Reasonableness is proven by disclosure (408(b)(2)), benchmarking against comparable plans, and periodic market testing — total compensation including revenue sharing and float, not just invoiced fees.
Read the full answerEveryone who handles plan funds must be bonded for at least 10% of funds handled — minimum $1,000, capped at $500,000 per plan, or $1,000,000 for plans holding employer securities. The bond protects the plan against dishonesty and is legally required, unlike fiduciary insurance.
Read the full answerYes, in almost every case. Fiduciary liability insurance defends committee members and the company against ERISA breach claims — the exposure behind 401(k) fee litigation — covering defense costs, settlements, and judgments. It's voluntary, distinct from the required fidelity bond and from D&O coverage.
Read the full answerFollowing DOL guidance, fiduciaries should ask vendors for their security program and standards, third-party audit results (like SOC 2 reports), breach history and response, data encryption practices, and contractual commitments to notification and liability — then revisit the answers annually.
Read the full answerPut these answers to work
Fiduciary In A Box walks your team through every one of these requirements step by step — documenting decisions, organizing files, and keeping your plan compliant year-round.
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