Purchasing Bonds
A bond protects your retirement plan against loss “by reason of acts of fraud or dishonesty” on the part of an administrator, officer, or employee.
Every administrator, officer, and employee who handles funds of a qualified retirement plan is required to be bonded.
Amount of Bond
The bond’s values should be at least 10% of the plan’s assets, with a minimum of $1,000 and a maximum of $500,000.
For trusts with non-qualifying plan assets, bonds should be 100% of the total value of non-qualifying assets. Non-qualifying assets are identified as not having a readily determinable value on an established market, including, but not limited to, real estate, non-publicly traded securities, shares in a limited partnership, and collectibles.
Who Can Provide a Bond?
An insurance broker or surety agent can assist you in obtaining this type of bond, or provide a rider or modification to an existing bond.
CLICK HERE to obtain a bond through Colonial Surety Company.