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What Is An ERISA Bond?

ERISA bond stands for Employee Retirement Income Security Act. This type of surety bond is a form of insurance that protects employees against fraud or unethical actions. When an employer provides pension plans, 401 (k) plans, and other similar programs, the person (fiduciary) who oversees the plans must have an ERISA bond according to the 1974 Employee Retirement Income Security Act. They may not operate without one.

Before fiduciaries purchase a bond from an agency, they must submit themselves to a credit check, have their application approved, and go through other screening processes.

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