Does Your Startup Need Fiduciary Liability Insurance for Its 401(k)?

A startup offering a 401(k) should consider fiduciary liability insurance. It addresses a different risk from an ERISA fidelity bond, and outsourcing plan administration does not automatically remove every employer responsibility. Read Corgi’s startup guide: https://www.corgi.insure/blog/fiducia... Explore fiduciary liability coverage: https://www.corgi.insure/fiduciary-li... This guide helps U.S. startup founders understand the questions to ask when launching a private-sector retirement plan or reviewing an existing one. It separates plan governance, bonding and insurance so you can discuss the actual arrangements with your adviser. WHAT YOU’LL LEARN • Fiduciary liability insurance and an ERISA fidelity bond protect against different kinds of loss. A liability policy does not itself satisfy an applicable bonding requirement. • Fiduciary status depends on the functions someone performs and the authority they exercise, rather than a job title alone. • Hiring a provider can delegate tasks, but selecting and monitoring providers can remain the employer’s responsibility. • Covered allegations can involve plan decisions or administration. A complaint does not guarantee coverage or payment. • Per-claim limits, annual aggregates and retentions are separate terms. A retention is not the annual premium. PUBLISHED EXAMPLE, NOT A QUOTE The video uses Corgi’s illustrative fiduciary policy summary: a $1 million per-claim limit, $2 million annual aggregate and $25,000 per-claim retention. These figures are not a recommendation for every startup. In the simplified defense-cost illustration, $200,000 already counted against a $1 million limit leaves $800,000 under that limit, before other payments or policy provisions. Actual declarations, wording, exclusions and retention treatment control. CHAPTERS 00:00 Does a startup with a 401(k) need fiduciary liability insurance? 00:47 Is fiduciary liability insurance the same as an ERISA bond? 01:34 Who is a fiduciary for a startup retirement plan? 02:20 Does outsourcing a 401(k) remove fiduciary responsibility? 03:07 What claims can fiduciary liability insurance address? 03:56 How do limits, retention and defense costs work? 04:46 What should a founder check before buying? SOURCES Corgi startup guide (January 10, 2026) and product summary linked above. U.S. Department of Labor — ERISA bonding and fiduciary liability distinction, Q2: https://www.dol.gov/agencies/ebsa/emp... IRS — Retirement plan fiduciary responsibilities: https://www.irs.gov/retirement-plans/... U.S. Department of Labor — Working with service providers: https://www.dol.gov/agencies/ebsa/emp... Sources reviewed October 8, 2026. General educational information; coverage depends on the issued policy and individual circumstances. Examples are illustrative. Narration and illustrative office footage are AI-generated. To explore options for your startup, visit https://www.corgi.insure