Fiduciary Liability Insurance

Fiduciary Liability insurance is designed for startups that create, manage, and administer employee benefit plans.

If current or former employees claim their assets weren’t invested properly or they received misleading plan advice, they may sue whoever is responsible. Fiduciary coverage can protect your startup in the event of such a lawsuit.

Fiduciary Liability coverage often goes hand in hand with Employee Benefits Liability coverage, which covers mistakes and oversights in benefits administration, like failing to enroll an employee in health insurance. Both help protect your startup once you introduce employee benefits.

Apply for Vouch’s Fiduciary coverage in 10 minutes or less.

General Liability

Whether you’re working on your first startup or your fifth, General Liability insurance is likely the first policy you’ve seriously considered buying. That’s because General Liability is often required by landlords, partners, and clients, all of whom you’ll likely encounter early in your startup experience.

This coverage can offer important baseline protection, protecting your business assets when visitors get injured on your property or by your product, when a third party accuses you of libel or slander, or when a lawsuit results from these types of third-party damages.

General Liability


Which startups should get Fiduciary Liability coverage?
When we say “fiduciary,” we mean someone who acts on behalf of another person to manage their assets.

If you run a startup, have employees, and offer them a benefits plan (like a 401(k)), you’re likely a fiduciary. 

What’s more, if you don’t have a dedicated employee to manage benefits administration, you’ll have to fit that work in around your many other duties as a founder, which can mean it will get less attention than it deserves.

Fiduciary coverage helps mitigate your risk exposure by covering legal expenses in the event of a covered employee lawsuit.

And because Vouch was designed specifically for startups, you’ll be able to apply for our Fiduciary coverage in less than 10 minutes and get covered within 24 hours – without printing or faxing a single document.

Ready for some peace of mind? 
Apply for Vouch Fiduciary Liability coverage today!


When should startups get Fiduciary Liability coverage?

You should consider getting fiduciary coverage if you have any of these employee benefit programs in place or plan to in the near term:

  • 401(k)

  • Employee stock ownership plans (ESOP)

  • Welfare plans

Don’t offer benefits? You may want to. One survey found that 66 percent of workers consider a good benefits package the biggest determining factor in deciding whether or not to take a job.

In other words: to attract the best talent, you need to offer benefits. And if you do, you’ll need Fiduciary coverage. Get it here.


Why should startups get Fiduciary Liability coverage?

The short answer: It protects you if you make a mistake managing benefit plans and get sued for it.

The long answer: Even if you act in your employees’ best interests, they might misinterpret your benefits advice. An employee might claim they were advised to make an investment that cost them money. Even if their claims are unsubstantiated, they can sue – and defending yourself in a lawsuit costs money. 

And Vouch’s Fiduciary Liability insurance in particular is designed specifically for startups, meaning you won’t pay for more (or less) coverage than you actually need.


What does Fiduciary Liability insurance cover?

A Vouch Fiduciary Liability insurance package can cover defense costs if an employee sues your startup over…

  • Misleading advice on investing employees retirement funds.

  • Poor investment decisions.

  • Poor or negligent investment practices, including failure to offer diversification options or charging excessive fees.

  • Poor communication in administering health and other welfare plans that result in lost benefits.

  • Mistakes in computing or administering plans (late enrollments, terminations, etc.), that result in lost benefits.

A startup sponsors a 401(k) plan for its employees. The plan administrator is a month late on making an employee-requested transfer. Before they do, a market downturn causes the employee to suffer losses from their remaining investment. The employee sues the startup. The Fiduciary policy covers defense costs and the court-ordered settlement.

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While Fiduciary Liability insurance can help your company manage some risks associated with offering employee benefits, it can’t cover claims related to violations of ERISA. It also can’t cover cases of dishonest acts or fraud; those would be handled by Crime insurance

Fiduciary Liability insurance also doesn’t cover…
  • Damage to your business property or losses caused by your product, which can be covered by a Business Owner’s Policy.

  • Claims that your professional work caused a financial loss, which are typically covered by Errors & Omissions insurance.

  • Employee injuries, which are covered by Workers’ Compensation.

  • Non-benefits-related employee lawsuits, which may be covered by Employment Practices Liability or Employee Benefits Liability insurance.

  • Data breach-related costs. These may be covered by Cyber insurance.

Why Vouch?

Why get Fiduciary Liability with Vouch Insurance?

As a startup founder, you have insurance needs, but you also have a lot of other things to get done.

Vouch was created by two founders who know how complicated insurance can get, so they made it simple for other founders.

You don’t want to pay more than necessary to manage your startup’s risks, especially after building an employee benefits program – which is a sizable investment in the future of your company. Vouch helps you protect that commitment to your employees in a hassle-free way.

Need something other than Fiduciary Liability insurance?

Still not quite sure what Fiduciary Liability covers? Need another type of coverage? Get in touch at We’d be happy to help.

Our other policies
General Liability

Baseline coverage that's often required by landlords, partners, and clients.

Business Property

Can cover the cost of repairing or replacing business property like laptops.

Cyber Coverage

For hacking- and data breach-related losses.

Directors & Officers (D&O)

Protects C-suite officers and board members if they’re sued over decisions they made on the startup’s behalf.

Errors & Omissions (E&O)

for lawsuits alleging your professional work caused a financial loss.

Crime Coverage

In the event that an employee commits theft, embezzlement, or related crimes.

Employee Practices Liability (EPL)

For employee lawsuits alleging discrimination or other wrongful treatment.

Hired & Non-Owned Auto

For when an employee drives their own car for something work-related, and an accident happens.

Questions about our coverages?

Reach out to to connect with a licensed insurance pro, call us at (415) 488-6728 during regular business hours, or chat with us in the lower right hand corner of your screen.

© 2020 Vouch, Inc. All Rights Reserved.
Insurance services provided by Vouch Insurance Services, LLC.  Descriptions are general in nature only. Please refer to the terms and conditions of any policies offered or purchased. Insurance products offered are subject to application and underwriting requirements. Not all products available in all states.  Pricing depends on a variety of factors including policyholder location.  Not all discounts available in all states.