Products November 10, 2010

Ascensus Announces New Fiduciary Liability Insurance

Ascensus is offering fiduciary liability insurance through its sister company, Crump Property and Casualty Insurance Services (Crump P&C). 
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The program is designed to help protect the assets of plan sponsors and the personal assets of fiduciaries from claims arising out of breach of fiduciary duty or negligent acts, errors or omissions in plan administration. The program helps provide protection beyond the required fidelity bond, according to a press release.  

“In recent years, assets in the retirement space have grown to more than $15 trillion and as a result of this increase and the down draft of investments in the poor economy, there are more legal challenges for fiduciaries,” explained Neil Smith, executive vice president, Strategic Business Support Services for Ascensus, in the announcement.  

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“Our Fiduciary Liability Insurance Program  helps protect those who have fiduciary responsibilities not only for 401(k) plans, but also employee benefit plans, welfare benefit plans, pension benefit plans, health savings accounts and other plans or programs that may or may not be subject to ERISA.  Our coverage is comprehensive, the pricing is competitive and the process to obtain a quote is streamlined and easy to use,” said Jacqueline LaRock, vice president for Crump P&C. 

In Practice November 10, 2010

Target-Dates Losing Image as Best QDIA

A recent survey revealed that plan sponsor perceptions of target-date funds, as compared to other QDIA options, are shifting.
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The survey by Janus Capital Group, in conjunction with Asset International, found an increasing number of sponsors indicate they believe balanced funds and target-risk funds are the best QDIAs for their employee populations. Just 34% of respondents said target-date funds are the best QDIA for their plan, down from 57% last year.   

In addition, when asked to compare QDIA options based on fees, transparency, overall performance, risk management, and correct usage by participants, balanced funds saw gains each category compared to last year, while target-date funds saw declines. Thirty-five percent of plans (compared to 29% last year) are not sure what the best QDIA option is for their employee population.  

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The survey also revealed a broad gap between plans’ utilization and understanding of target-date funds.  Despite the increasing number of DC plans offering target-date funds, a significant percentage of sponsors are still unclear about many aspects of the target-date funds within their investment menus.   

Compared to 2009 findings, more plans don’t know what the end date of the glide path is in their target-date funds (50% compared to 32% last year). More than one-third of all plans are not familiar with the “to” or “through” glide path dilemma.   

“The findings reveal a disconnect as respondents believe they’re less than well informed about their chosen target-date offerings, but remain confident their employees understand the products and use them correctly. This confirms an opportunity exists to provide plan sponsors with education about the structures and mechanics of target-date funds,” said Russ Shipman, senior vice president and managing director of Janus’ Retirement Strategy Group, in a press release.

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