The Certification values the intangibles of services, provides an independent evaluation to plan sponsors and creates a critical role for advisers and third-party administrators (TPAs). Service providers with successful plans, high-quality service and active investment management are evaluated on these factors, not just the cost of the offering.
Plan sponsors receive certification that is evidence of the required evaluations, as well as suggestions for improving their plans. Plan sponsors are expected to engage their advisers to implement improvements under separate or existing arrangements.
Advisers and TPAs receive free online training to support plan sponsors in their evaluations. Advisers and TPAs are expected to charge fees for this additional support since it goes beyond typical arrangements.
“The benefits of Fee Disclosure Certification creates a win, win, win,” said Kathleen Whalen, managing director at Dalbar. “Service providers win by quantifying the value of their services, plan sponsors win by simplifying compliance, and advisers/TPAs create a new service and revenue opportunity.”
Details of the Fee Disclosure Certification is available at www.ERISAFeeDisclosure.com.