ERISA Fidelity Bond: Cost, Coverage & 401(k) Requirements (2026)
An ERISA bond is a fidelity bond required by the U.S. Department of Labor that protects an employee benefit plan (such as a 401(k) or pension) from losses caused by fraud or dishonesty of plan officials. It is also called an ERISA fidelity bond, 401(k) fidelity bond, pension plan bond, or ERISA surety bond — all five terms describe the same product. The bond must equal at least 10% of plan assets handled, with a $1,000 minimum and a $500,000 maximum ($1,000,000 if the plan holds employer securities).
| Detail | Requirement / Range |
|---|---|
| Legal Basis | ERISA Section 412 — required by U.S. Department of Labor |
| Coverage Formula | 10% of plan assets handled in the prior plan year |
| Minimum Bond | $1,000 |
| Maximum Bond | $500,000 — or $1,000,000 if the plan holds employer securities |
| Typical Cost | $100–$500 per year for most small & mid-size plans |
| Who Must Be Bonded | Every plan official who handles plan funds or property |
| Term | 1 year (renewable) — multi-year terms available |
| Credit Check | Not required — instant approval for most applicants |
| Issue Time | Same-day in most cases |
Apply Now (3 min) or call (913) 214-8344
What Is an ERISA Bond? (Also Called ERISA Fidelity Bond, 401(k) Fidelity Bond, Pension Plan Bond or ERISA Surety Bond)
An ERISA bond is a fidelity bond required by federal law under Section 412 of the Employee Retirement Income Security Act of 1974 (ERISA). It protects an employee benefit plan — and the plan’s participants and beneficiaries — from losses caused by acts of fraud or dishonesty committed by any person who handles plan funds or other plan property.
The instrument has five common names that all describe the same product:
- ERISA bond — the most common short form
- ERISA fidelity bond — the full statutory name used by the Department of Labor
- 401(k) fidelity bond — common in retirement-plan administration
- Pension plan bond — used in defined-benefit pension contexts
- ERISA surety bond — less common; technically a misnomer (it is a fidelity, not a surety) but widely searched
You will also see related variants: employee benefit plan bond, retirement plan bond, plan fiduciary bond, and DOL bond. All describe the same federally-mandated fidelity protection for ERISA-covered plans.
Scale of the requirement: The Department of Labor estimates roughly 690,000 ERISA-covered plans holding more than $7.3 trillion in plan assets in the United States — approximately 82% of which are self-insured by the sponsoring employer. Every one of those plans is required to maintain an ERISA fidelity bond.
FOUNDATION & OVERVIEW
ERISA Bond Cost — How Much in 2026?
ERISA bonds are priced primarily by the bond amount (which is set by the size of the plan, not by the bonded individual’s credit). Because the surety pays only after an act of fraud or dishonesty — and because plan fiduciaries are typically subject to extensive regulatory oversight — losses are rare and rates stay low.
| Bond Amount | Plan Size (Assets Handled) | Typical Annual Premium |
|---|---|---|
| $10,000 | Up to $100,000 | $100/yr |
| $50,000 | $100,000 – $500,000 | $150–$200/yr |
| $100,000 | $500,000 – $1M | $200–$300/yr |
| $250,000 | $1M – $2.5M | $300–$400/yr |
| $500,000 (maximum) | $5M+ | $400–$500/yr |
| $1,000,000 (employer securities) | Plans holding employer stock | $600–$900/yr |
Average cost: roughly $200–$300 per year for a typical small-business 401(k) with under $1M in assets. Multi-year terms (2- and 3-year) typically receive a 10–15% discount. For the full pricing methodology see our ERISA bond cost — what influences pricing page, or use the ERISA bond amount calculator to compute the minimum coverage your plan is required to carry.
ERISA Bond Requirements — DOL 10% Rule, $1,000 Minimum, $500,000 Maximum
ERISA Section 412 sets the coverage formula precisely. The bond amount required for each plan official is calculated as follows:
| Coverage Rule | DOL Requirement |
|---|---|
| 10% Rule | Bond must cover at least 10% of the plan assets each official handled in the prior plan year |
| Statutory Minimum | $1,000 — even for the smallest plan |
| Statutory Maximum (standard) | $500,000 per plan official |
| Statutory Maximum (employer securities) | $1,000,000 per plan official if plan holds employer stock |
| Covered Acts | Fraud, dishonesty, theft, embezzlement, forgery, larceny, misappropriation, wrongful conversion |
| Who Must Be Bonded | Every fiduciary or other person who handles plan funds or property |
| Form 5500 Reporting | Bond amount and surety must be reported on Schedule H or I of the annual Form 5500 |
Worked example: A 401(k) plan held $2,000,000 in assets last year. The trustee who signed checks handled 100% of those assets. 10% of $2M is $200,000 — below the $500,000 cap and above the $1,000 floor — so the required bond is $200,000. If the plan also held employer stock, the cap rises to $1M but the calculation still produces $200,000, so the minimum required bond remains $200,000.
Owner-only exemption: A plan that covers only the business owner (and the owner’s spouse) is generally not required to carry an ERISA bond. Multi-employee 401(k) plans almost always must be bonded.
For the latest year-by-year compliance checklist see our 2025 ERISA bond compliance checklist for 401(k) plans and the 2025 fiduciary compliance update.
ERISA Bond vs. Fiduciary Liability Insurance — Key Differences
Plan sponsors routinely confuse an ERISA fidelity bond with a fiduciary liability insurance policy. They are two separate products with two separate purposes:
| Attribute | ERISA Fidelity Bond | Fiduciary Liability Insurance |
|---|---|---|
| Required by ERISA? | Yes — Section 412 | No — voluntary coverage |
| Who Is Protected | The plan & its participants | The fiduciary personally |
| Covered Acts | Fraud, dishonesty, theft | Breach of fiduciary duty, negligent administration, bad investment decisions |
| Trigger | Criminal-style dishonest act | Civil claim against fiduciary |
| Coverage Limit | 10% of plan assets ($1K–$500K) | Chosen by plan ($1M, $5M, $10M+) |
| Typical Cost | $100–$500/yr | $1,500–$10,000+/yr |
| Form 5500 Reporting | Required on Schedule H/I | Not required |
Most prudent plans carry both. The ERISA bond satisfies the federal mandate; fiduciary liability insurance protects the trustees, officers, and committee members personally against civil suits from participants. For a side-by-side breakdown see our ERISA bond vs. fiduciary liability insurance comparison and the deeper ERISA bond vs. fidelity bond explainer.
How to Get an ERISA Bond — 5-Step Application
- Calculate the required bond amount. Take the highest amount of plan funds handled by any one official in the prior plan year and multiply by 10%. The result — subject to the $1,000 floor and $500,000 cap (or $1M with employer securities) — is the minimum bond required for that official. Most plans bond all officials at the same amount for simplicity. Use the ERISA bond amount calculator.
- List the officials to be bonded. Every person who handles plan funds or property — the named fiduciary, the plan administrator, the trustee, the plan sponsor’s officers, and outside service providers if they have signing authority — must be covered.
- Submit the application. Use the 3-minute Swiftbonds online form or download a paper application from the state matrix below. Required info: plan name, plan sponsor, EIN, plan number, prior-year plan assets, requested bond amount, list of bonded officials, plan effective date.
- Pay the premium. No credit check, no underwriting delay. The bond is bound the same business day for most applicants.
- Receive the bond & report on Form 5500. The bond certificate is emailed the same business day. The bond amount, surety name, and policy number must be reported on Schedule H (large plans) or Schedule I (small plans) of the annual Form 5500. Keep a copy of the bond with plan records for DOL audit.
For a more detailed walkthrough see our ERISA bond application process page.
ERISA Bond by Plan Type — 401(k), Pension, Health & Welfare
ERISA covers three broad categories of employee benefit plans, each with the same fidelity-bond mandate but slightly different coverage considerations:
| Plan Type | Bond Required? | Typical Bond Range | Notes |
|---|---|---|---|
| 401(k) Plans (defined contribution) | Yes — unless owner-only | $10,000 – $500,000 | Most common ERISA bond use case. Cap rises to $1M if plan holds employer stock (ESOP & matching). |
| Pension Plans (defined benefit) | Yes — always | $50,000 – $500,000 | Includes traditional pension, cash balance, money-purchase plans. 10% rule applies the same way. |
| Health & Welfare Plans | Yes — if funded | $1,000 – $500,000 | Required when the plan has assets held in trust (VEBAs, HRA trusts). Unfunded, pay-as-you-go welfare plans generally exempt. |
| 403(b) & 457 Plans | Yes — if ERISA-covered | $10,000 – $500,000 | Most private-sector 403(b)s are ERISA-covered. Governmental 457(b) plans are exempt. |
| Profit-Sharing & ESOPs | Yes — always | $50,000 – $1,000,000 | $1M cap applies because plan holds employer securities. |
| Solo / Owner-Only 401(k) | No | N/A | Plans covering only the owner (and spouse) are exempt from ERISA bonding. |
ERISA Bond by State — Application Forms & Policy Resources
ERISA is federal law — the same 10% / $1,000 / $500,000 rules apply nationwide — but Swiftbonds maintains state-specific ERISA pension plan fidelity bond applications and dedicated state policy pages to streamline filings. Click your state below to download an application or view local policy information:
Don’t see your state? Call (913) 214-8344 — Swiftbonds issues ERISA fidelity bonds in all 50 states.
ERISA Bond FAQ
What is an ERISA bond?
An ERISA bond is a fidelity bond required by Section 412 of the Employee Retirement Income Security Act of 1974. It protects an employee benefit plan and its participants from losses caused by fraud or dishonesty of any person who handles plan funds or property. It is also called an ERISA fidelity bond, 401(k) fidelity bond, pension plan bond, or ERISA surety bond.
How much does an ERISA bond cost?
Most ERISA fidelity bonds cost $100 to $500 per year. Premium is set by the bond amount — not the bonded individual’s credit. A typical small-business 401(k) under $1M in assets pays $200–$300/yr; plans at the $500,000 statutory cap pay $400–$500/yr; plans requiring the $1M employer-securities limit pay $600–$900/yr.
Is an ERISA bond the same as a fidelity bond?
Yes — an ERISA bond is a fidelity bond. The phrase “ERISA bond” simply refers to the specific federally-mandated fidelity bond required by ERISA Section 412 to protect employee benefit plans. Other fidelity bonds (commercial crime, employee dishonesty bonds) protect a business; an ERISA bond protects the plan and its participants.
How much ERISA bond coverage do I need?
The bond must cover at least 10% of the plan assets each official handled in the prior plan year, with a $1,000 minimum and a $500,000 maximum ($1,000,000 if the plan holds employer securities). Example: $2M in plan assets × 10% = $200,000 required bond.
Is an ERISA bond required by law?
Yes. ERISA Section 412 requires every fiduciary and every other person who handles funds or other property of an employee benefit plan to be bonded. The requirement is enforced by the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA). The bond amount and surety must be reported annually on Form 5500.
Who needs an ERISA bond?
Every plan official who handles plan funds or property — the named fiduciary, plan administrator, trustees, plan sponsor’s officers, and any outside service provider with signing authority. The bond covers each of them up to the required amount.
Can a solo 401(k) or owner-only plan skip the ERISA bond?
Yes. Plans that cover only the business owner (and the owner’s spouse) are not subject to ERISA bonding requirements. Multi-employee 401(k), pension, and welfare plans almost always must be bonded.
What is the difference between an ERISA bond and fiduciary liability insurance?
An ERISA bond is required by law and protects the plan against fraud or dishonesty. Fiduciary liability insurance is voluntary and protects the fiduciary personally against civil claims of breach of duty or negligent administration. Prudent plans carry both.
How do I get an ERISA bond?
Submit a 3-minute application with the plan name, sponsor, EIN, prior-year plan assets, requested bond amount, and list of bonded officials. No credit check required. Most bonds are issued the same business day and emailed immediately. Apply now.
What happens if my plan doesn’t have an ERISA bond?
The plan is out of compliance with ERISA Section 412 and must report the deficiency on Form 5500. Failure to maintain a bond can trigger a DOL investigation, civil monetary penalties, and personal fiduciary liability for losses to the plan. Form 5500 specifically asks whether the plan is bonded and for what amount; “no” answers commonly prompt audit selection.
Ready to get your plan bonded? Most ERISA fidelity bonds are issued the same business day — no credit check required.
Apply Now (3 min) or call (913) 214-8344
Related ERISA Bond Resources
- ERISA Bond Amount — How to Calculate Minimum Coverage
- ERISA Bond Cost — What Influences Pricing
- ERISA Fidelity Bond Cost — Pricing Factors
- ERISA Bond Application Process — Step-by-Step
- ERISA Bond Claims — Understanding the Process
- ERISA Bond Requirements for 401(k) Plans — 2025 Compliance Checklist
- ERISA Fidelity Bond Requirements — 2025 Fiduciary Compliance
- ERISA Bond vs. Fiduciary Liability Insurance
- Is an ERISA Bond the Same as a Fidelity Bond?
- Hartford ERISA Bond Policy
- Travelers ERISA Bond Coverage Options
- Browse all License & Permit Bonds