An ERISA bond for an investment advisor is a specially underwritten bond that is required of all ERISA fiduciaries.  Section 412 under ERISA states every fiduciary of an employee benefit plan and every person who handles funds or other property of such a plan shall be ?bonded? against fraud or dishonesty. Investment advisors who control plan assets and make investment decisions for ERISA Plans are required to maintain an investment advisors ERISA bond.

 

Investment Advisors are required to have this bond with limits of a percentage of assets under management, up to a maximum of $500,000 for each qualifying plan.  Under the The Pension Protection Act of 2006 bonding limits were increased to $1,000,000.

 

Bonds can be written on an individual basis, where each plan is identified, or written as a blanket bond covering all plans.

 

Underwriters will need to review the following information:

 

• Sample investment management agreements

• Custodial authority of the funds

• Name of the Plan

• Type of Plans

• Assets under management

Please contact our office for further information.