ERISA Fidelity Bonds 101: Who Must Be Bonded, How Much, and How to Buy
TL;DR
Most employee benefit plans need an ERISA fidelity bond to protect the plan’s assets against fraud or dishonesty by anyone who handles plan funds or property. The required amount is 10% of plan assets, with a minimum of $1,000. The cap is $500,000, or $1,000,000 if the plan holds employer securities. If you are not sure whether your plan contains employer securities, you should consult with your plan administrator. You can purchase a bond online in minutes via our portal.
What is an ERISA fidelity bond?
An ERISA fidelity bond is a special type of insurance required by ERISA §412. It protects the plan, not the employer or individual fiduciaries, against loss from acts like theft, embezzlement, forgery, or fraud by people who handle plan money or property.
Who must be bonded?
Anyone who handles funds or other property of the plan. This can include people who receive, safeguard, or disburse plan money, sign checks, authorize ACH or wire transfers, process distributions, have access to cash, checks, or negotiable instruments, or can direct investments or transfers. If in doubt, assume bonding is required for roles with direct or indirect control over plan assets.
How much bond do we need?
Use this simple formula.
Minimum: $1,000
Amount: 10% of plan assets
Cap: $500,000, or $1,000,000 if the plan holds employer securities
Examples
• $2,400,000 in assets → 10% = $240,000 → required bond $240,000
• $9,000,000 in assets with no employer stock → 10% = $900,000 → cap applies → $500,000
• $9,000,000 in assets with employer stock → 10% = $900,000 → under $1,000,000 cap → $900,000
Where do we find plan assets?
Use the DOL eFAST 5500 Search. Search by plan name or EIN and read the rightmost column in the results table labeled Total Plan Assets, End of Year. Use the most recent filed year. If the plan is new and has no filing yet use the latest trust or custodian statement.
What makes a bond acceptable?
The bond should be issued by a Treasury-listed surety. Confirm the legal name on your bond matches a company on the current List of Approved Sureties. Save evidence of that listing in your plan file.
Typical term and helpful features
Term: many sponsors choose a 3-year bond to reduce administrative work. Certain sureties will offer 1 or 2-year terms as well. HK Insurance Agency, Inc. only offers 3-year bond terms.
Automatic adjustments: programs like ours include “inflation guard”, which helps the bond track asset growth up to the applicable cap. In other words, coverage automatically increases to 10% of the plan assets up to $500,000 or $1,000,000, depending on whether the plan holds employer securities.
Buy your bond online
Issue a compliant ERISA bond in minutes:
https://hksurety.my.site.com/SelfRegister
This material is for general informational purposes only and is not legal, tax, or accounting advice. You should consult qualified counsel or advisors about your specific plan. Coverage requirements, eligibility, pricing, and features depend on the terms of your bond and applicable law. If anything here differs from your bond, plan documents, or governing regulations, rely on those documents. References to plan asset calculations and example amounts are illustrative only and may not fit every plan type. Links and information are accurate as of October 2025. Regulations, agency guidance, forms, websites, and carrier participation can change without notice. Purchasing through our portal is subject to underwriting and the terms and conditions of the issuing surety.
