A fiduciary is a person who administers other people’s money or goods. If you are designated as a fiduciary for someone, you are in charge of managing their assets and putting the client’s needs above your own.
This is a serious and sometimes risky job. Fiduciaries can handle many very important things, as well as money. They need fiduciary insurance to protect them from claims of mismanagement. These sorts of claims usually occur when a fiduciary loses money due to poor decisions or unwise investments.
They can be better protected by purchasing fiduciary insurance.
Steps to Avoid Needing Fiduciary Insurance
To avoid claims against you, it’s essential to do your fiduciary job well. Here are a few basic tips on doing so:
- Act for the benefit of the other person. Take wise decisions that will bring profit to them.
- Administer money and goods with commitment.
- Keep the money and goods separated and in excellent condition. Do not mix them with yours or anyone else’s.
- Keep records. Do not skip this step. Your records must be complete, legible and credible. Your records can save you from legal consequences and help you if you need fiduciary insurance to cover you.
Because of the great responsibility you have, prioritize purchasing fiduciary Insurance. It can protect you from future claims, covering costs of legal process.