Actuaries Aren’t Fiduciaries

In Chua v. Shippee, the U.S. District Courtfor the Northern District of Illinois dismissed breach of fiduciary duty claimsbrought against an actuary.

Thetaxpayers in this case sued an actuary who gave “bad” advice about a 412(i)life insurance plan.  The court found theactuary’s advice was not enough to establish a fiduciary relationship becausethe clients always retained final decision-making authority.

Thisdecision is good news for actuaries who wouldn’t want the higher duty of carethat comes with being a fiduciary as well as the added liability for breachesof co-fiduciaries.  

See Timothy Muth, United States: Actuaries Are Not Fiduciaries(And That’s a Good Thing), Mondaq, Sept. 23, 2013.