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Investment Advisor Surety Bonds

In certain states, Registered Investment Advisors (RIAs) must hold a surety bond. Additionally, if your duties involve offering investment advice to a participant of an ERISA plan, the U.S. Department of Labor requires you to post an ERISA Fidelity Bond. The following information explains what a surety bond is, what it covers and how to purchase one.

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Easiest system to use and, by far, the fastest company with providing E&O and Surety bond insurance. HIGHLY recommend!
Mortgage H.
Mortgage H.
20:51 02 Mar 22
Surety Solutions goes above and beyond their duty to make their customer feel confident that they are choosing the right company. Jessi Wimer personally helped me through the process. She was very informative and made sure that every concern I had was dealt with in the most professional and efficient way. Thank you for your hard work!
Chris L.
Chris L.
17:07 08 Feb 22
Excellent service; they exceeded my expectations in timeliness and professionalism.
Bridgette M. B.
Bridgette M. B.
23:24 10 Dec 21
Client services provided quick and accurate responses.
James G.
James G.
17:49 30 Nov 21
Very helpful and they respond quickly to any questions.
Eva Hammel H.
Eva Hammel H.
16:46 30 Nov 21
Katrina Fearn, Client Service Manager at Surety, is an absolute pleasure to work with!! She is always highly responsive, and has provided me nothing but excellent service since our first interaction. I highly recommend working with her and the Surety team. They will always go above and beyond. Thank you for all that you've done!
Zakieh A.
Zakieh A.
16:38 04 Nov 21
I have been working with Steve Shike and he has been so helpful. I purchased the wrong bond and Steve instantly requested a refund on my behalf and called back with the good news. I appreciate him for helping me figure out my situation in such a timely matter. Thank you Steve for responding to my calls and emails promptly.
Ashley W.
Ashley W.
18:25 10 Aug 21
Gerry J.
Gerry J.
16:30 08 Aug 21
Katrina and Surety Solutions was awesome to work with and made the process seamless. Even after I, PERSONALLY, made a mistake and caused a delay, Katrina was able to spot my mistake and kindly address the error while still delivering my bond as if nothing had happened.I have nothing but good things to say about Surety Solutions.
Xavier A.
Xavier A.
15:40 22 Jul 21
jerry T.
jerry T.
04:44 03 Jul 21
Katrina and Surety Solutions were very helpful and fast. I needed to change the bond I ordered and they handled that within minutes. Their response time to emails and request were great and that is why I will continue to work them both. All I ask for is relatively decent response time when there are issues that need resolved and Katrina far exceeded that and was friendly on top of everything else. Well done.Kris
Kristopher M.
Kristopher M.
14:23 24 Jun 21
Grace answered the phone immediately with a positive attitude and willingness to help. She followed through professionally and promptly through entire process.
Danny S.
Danny S.
14:41 15 Jun 21
Surety Solutions has been the most amazing and easiest company to work with on Bonds in my past 17 years of doing insurance. They are very quick to respond and very personal to work with. Jake Durrant is absolutely the best!
Bonnie A.
Bonnie A.
20:39 20 May 21
Suzie T.
Suzie T.
17:14 07 May 21
Easy experience.
Tonya B.
Tonya B.
01:18 21 Apr 21
I had the pleasure of working with Katrina Fearn to obtain mortgage broker surety bonds and I can say with zero hesitation, that she is wonderful to work with. Extremely responsive, communicative and helpful. Surety Solutions + Katrina = Great Partnership. Thanks!!!
Ryan M.
Ryan M.
20:18 19 Apr 21
Can't say enough good things about Katrina Fearn, she was exceptionally prompt, responsive and a true professional in getting me the bond in a timely manner. Just amazing customer service.
Umesh M.
Umesh M.
23:34 07 Apr 21
I needed a copy of my bond and with people working form home I thought is was going to take a long time. I got an email with the copy of my bond with in minutes. Never seen anything like that. Very Professional and fast response. thank you for good business ethic
Ernesto U.
Ernesto U.
19:08 10 Feb 21
Just obtained Mortgage Broker Surety Bond for two states. not only the price was right but service and professionalism exceeded my expectations. i can't thank Steve enough and wish i knew them sooner.
Ruslan K.
Ruslan K.
22:43 08 Jan 21
I bought a surety bond for my business. The name on the application has my middle name on it and the policy didn't. That would or could have created a problem. I wrote to customer service to complain. Well not complain but ask for it to be changed. Since it was Thanksgiving weekend I wasn't expecting to hear back till this week sometime. Well to my surprise it was "Very" Quickly. JD was very helpful and professional. Fixed it then contacted me with the corrected version. Couldn't be happier. " Good Business is Good Business"
MrDarryk
MrDarryk
05:17 01 Dec 20
JP M.
JP M.
01:46 04 Nov 20
Amazing customer service and friendly and informative reps.
Obsesion H.
Obsesion H.
04:45 26 Oct 20
Surety solutions handled my request for a Guardianship Bond professionally, with great care and provided great value to my family. Of all of the insurance companies I contacted for my need, Surety Solutions was by far the most responsive, courteous and knowledgeable. I very much appreciate their fine service!!
Irena S.
Irena S.
03:00 25 Sep 20
The entire staff from Jake to Katrina were more than professional and bent over backwards to meet mine and The State of California's requirements
Kirk G.
Kirk G.
19:10 23 Jun 20
This process could not have been easier! Mr. Chipman sent me an email link and I just followed the steps. I highly recommend Mr. Beau Chipman to anyone who needs this service.
Sharon H.
Sharon H.
23:29 28 Apr 20
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Registered Investment Advisor (RIA) Bonds

What is an RIA Bond?

As an investment advisor, you must follow the rules and standards of professional conduct set by the state in which you do business. Most states require you to have an Investment Advisor Surety Bond to ensure you perform your advisor responsibilities ethically and responsibly. While a surety bond is an insurance product, it works more as a line of credit.

A bond is a three-party contract between you, the obligee and the surety.

The principal – As the investment advisor, you are the principal of the bond.

The obligee – The government agency requiring you to submit a surety bond.

The surety – This party issues the bond. They also investigate and settle claims made against the bond.

If your client believes they have been deceived or manipulated by you, they may seek to make a claim against your bond.

What happens if a claim is made?

The surety company conducts an investigation on any claims made against your bond. These claims could be due to you breaching fiduciary duties, providing inaccurate representation, violating federal securities law or any other unethical act against your clients. If a claim proves to be valid, the surety will pay out up to the full amount of your bond. As the principal of the bond, you are the responsible party for paying the surety back the full amount.

How much does the bond cost?

The cost of your bond (also called the premium) depends on a few factors, including the bond amount and your personal credit score. Generally, the bond amount is set by the obligee and can range between $10,000 and $50,000. If you are unsure of the bond amount to enter on your application, please contact the obligee. Please be aware that the premium is not the same as the bond amount. You will only pay a small percentage of the bond amount as premium.

The other important factor that determines the amount of premium you pay is your personal credit standing. Approved applicants with good credit can expect to pay between 1% and 3% of the bond amount.

Can I still get an RIA Bond with bad credit?

A soft pull on your credit is necessary to receive a quote for your Investment Advisor Bond. However, you may qualify for a quote even if your credit is bad. Our partnership with leading surety providers allows us to place applicants with non-standard credit. Upon approval for a quote, expect the bond premium to be in the range of 5% to 15% of the bond amount.

Getting your surety bond quote doesn’t adversely affect your credit score and our no-obligation quotes are always free.

Does my bond cover me in other states?

Unfortunately, your Investment Advisor Bond will not satisfy bond requirements set in states other than the specified state on your bond form. Due to each state having specific licensing requirements and its own rules and regulations, you will need a bond for each state you plan on performing your duties as an investment advisor.

ERISA Fidelity Bond

What is an ERISA Fidelity Bond?

The purpose of the Employee Retirement Income Security Act (ERISA) of 1974 is to protect participants and their beneficiaries of an employee benefit plan. The ERISA Fidelity Bond, a requirement of the U.S. Department of Labor, ensures the funds from 401k plans, pensions and other employee benefits are protected from theft or other fraudulent acts. Investment advisors may need to secure an ERISA Fidelity Bond if they work with their client’s ERISA plans.

You must adhere to this federal law and get an ERISA Bond if you are responsible for any of the following:

  • Disburse, move or negotiate plan funds
  • Implement or negotiate documents related to the plan
  • Physically handle checks, money or other assets of the plan

How much do I select for the bond amount?

Getting quotes for your ERISA Fidelity Bond is quick and easy using our online application. Get started by selecting the bond amount you require.

Not sure what to select for your bond amount? We recommend contacting the U.S. Department of Labor to verify the amount of coverage they require of you. The amount you select needs to equal 10% of the total plan funds you handled last year or $1,000, whichever is more.

However, you will not pay the full bond amount. Depending on your bond amount requirement, your bond could cost as little as $165 for a 3-year term.

What does an ERISA Fidelity Bond cover?

Unlike traditional insurance, a surety bond is a mix of insurance and a line of credit. However, the ERISA Bond does not provide coverage for you. Instead, the bond serves the purpose of protecting the employees of the plan from financial loss.

The 3 parties associated with the bond are:

  • The Obligee – The U.S. Department of Labor requires this bond to protect the employees associated with the benefits plan. They have the ability to make a claim against the Surety Bond if they suffer a loss due to fraud or mishandling of the funds by the principal.

     

  • The Principal – You are the principal of this bond. If the surety pays out to the claimants due to a valid claim, the responsibility of repaying the surety back in full rests on you, the principal.

     

  • The Surety – The neutral third party you choose to issue your bond. An investigation takes place when a claim is made against the ERISA Fidelity Bond. If a claim is found to be valid, the surety will pay out up to the full bond amount.

What are “non-qualified” assets?

One of the questions on our ERISA Bond application is “Does the plan include any non-qualified assets?” 

Money able to be used for any purpose and funded with post-tax dollars is considered non-qualified assets. Non-qualified investments typically don’t restrict your ability to contribute to them in a given year and don’t require you to withdraw money out of your account when you reach a specific age. Not all non-qualified investments grow on a tax-deferred basis.

Money specifically earmarked to provide income during your retirement years and is funded with pre-tax dollars is considered qualified assets. Qualified investments, such as your employer’s 401k, generally allow you to contribute to your account up to a dollar amount specified by the Internal Revenue Service (IRS) each year. Also, they penalize you for taking withdrawals before you reach the age of 59 and a half and require you to start taking withdrawals prior to turning 70 and a half years of age. 

The majority of qualified assets include provisions allowing both you and your employer to contribute to your retirement account. Contributions from both sources grow tax-deferred.

After you purchase your ERISA Fidelity Bond

When you receive your quotes, you’ll have the option to purchase your ERISA Fidelity Bond online. After purchasing your bond, you can instantly download your bond packet. You don’t have to submit your bond to the obligee, the U.S. Department of Labor. However, you will need to keep the bond in your records in case they perform an audit.

Why get my bond with Surety Solutions, A Gallagher Company?

Getting a surety bond is an important step in meeting federal and state requirements. The process of getting your surety bond doesn’t have to be complicated or time-consuming. By completing our quick and easy online application, you’ll have a quote within 48 business hours, upon approval. Have a question about the required surety bond or our online application? Send us a message using the contact form below, or email customercare@suretysolutions.com. Our team of surety experts is available for any of your questions about Investment Advisor Bonds or our online application.

Contact us

  • Max. file size: 1 GB.
    If the entity requiring you to get a bond provided a bond form, please upload it here.

Lookin for another type of surety bond?

Thousands of surety bond types exist as part of licensing and obligation requirements for business. By using our online surety bond marketplace, we offer an easy, low-cost solution for getting the bonds you need. Get free surety bond quotes from leading surety companies today!

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