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Fiduciary — as defined by the Employee Retirement Income Security Act (ERISA), an individual or corporation that: (1) exercises any discretionary authority or discretionary control in managing a pension or benefit plan or exercises any authority or control in managing or disposing of its assets; (2) renders investment advice for a fee or other compensation, with respect to any monies or other property belonging to the plan; or (3) has any discretionary authority or responsibility in administering the plan. ERISA, which was passed in 1974, not only formalized the law associated with the administration of employee pension and benefit plans; it also broadened the scope of such liability so that it became a "personal" rather than simply a "corporate" liability. The effect of this change was that soon after ERISA's enactment, insurance companies began offering fiduciary liability insurance policies, which were specifically designed to cover this newly legislated exposure.

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