Overview
This post combines two essentials for plan administrators and ERISA bond purchasers. First, how to calculate the required ERISA fidelity bond amount using the statutory formula. Second, how to confirm that your bond is issued by an acceptable surety so the bond actually satisfies ERISA §412.
How to calculate the required bond amount
Use the simple ERISA formula.
Minimum: $1,000
Amount: 10% of plan assets
Cap: $500,000, or $1,000,000 if the plan holds employer securities
Which asset number to use
Use the most recent plan year’s end of year total plan assets. If the newest filing is not available yet, use the prior filed year. For brand new plans without a filing, use the latest trustee or custodian statement.
Quick examples
Assets $2,400,000, 10% equals $240,000, required bond $240,000
Assets $9,000,000 with no employer stock, 10% equals $900,000, cap applies, required bond $500,000
Assets $9,000,000 with employer stock, 10% equals $900,000, under the $1,000,000 cap, required bond $900,000
Assets $7,500, 10% equals $750, minimum applies, required bond $1,000
Edge cases to watch
- Multiple plans under one sponsor, calculate and place a bond for each plan separately.
- Mid year growth, if assets increase materially, review your bond amount, many programs include automatic adjustments but you should still confirm.
- Amended filings, if a plan year was amended, use the most recent amended record.
- Pooled arrangements, confirm you are sizing the bond at the correct plan level.
What makes a surety acceptable
ERISA requires the bond be issued by an acceptable surety. In practice, this means the surety is on the current List of Approved Sureties, often referred to as Treasury listed. The surety named on the bond must be the legal entity that appears on the list, not only a brand name or affiliate. Plans, plan sponsors, and parties in interest should not control or have a significant financial interest in the surety.
How to verify your surety
Find the legal name of the surety on your bond. Check that exact legal name against the current List of Approved Sureties and confirm it is active. Note any underwriting limitations and ensure your bond amount is within those limits. Save a PDF or screenshot of the listing with your bond certificate in the plan file. If the bond refers to reinsurance, retain documentation that identifies the Treasury listed reinsurer.
Buying steps
Identify who handles plan funds or other property.
Find end of year total plan assets and apply the 10 percent rule, check the minimum and the correct cap.
Confirm the surety is acceptable and that the legal name on the bond matches the approved list.
Bind the bond, download the certificate or declarations, and save proof of the surety listing in the plan file.
Issue your bond online
You can issue a compliant ERISA bond in minutes through our portal.
Audit ready checklist
Calculated 10 percent, minimum of $1,000, correct cap applied
Used the most recent end of year plan assets
Surety is acceptable, legal name matches the approved list
Save the bond certificate and proof of surety listing in the plan file
Set a renewal reminder and yearly asset review
Disclaimer
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.
