What is Fiduciary Liability? It is coverage for mismanagement claims, errors and omissions in the duties prescribed by the federal law ERISA for the administration of the firm's own employee benefit plan. It protects welfare and pension plans, the sponsor organization, and individuals acting as fiduciaries or administrators of the plans. The policy covers liability arising out of violations of any of the responsibilities, obligations, or duties imposed upon fiduciaries by ERISA. It also covers liability arising out of such activities as: (1) Counseling employees with respect to welfare and pension plans. (2) Providing interpretations of the plans. (3) Handling records or administering enrollment. Under ERISA, fiduciaries can be held personally liable for losses to a benefit plan incurred as a result of alleged errors, omissions, or breach of their fiduciary duties.