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​Trustees are responsible for administering and handling the assets in a trust. Because of the nature of this work, trustees face liability risks, which can lead to costly lawsuits. That’s where trustee errors and omissions insurance can help.
 
Trustees can set up and administer various types of trusts, with the most common being a Beneficiary Trust.  Trustees face a variety of liability risks because they’re handling a trust and assets. Trustees can get sued for negligence, mistakes in their handling of the trust or misrepresentation. Some common trustee errors and omissions exposures include:
 

• Negligent selection of outside professionals where the person the trustee hired to help them administer the trust made a mistake. Outside professionals includes attorneys, investment advisors and accountants.

• Negligence for not hiring professionals to assist in the administration of a trust.

• Mismanagement of trust assets or unwise investment decisions.

• Lawsuits from beneficiaries who believe they didn’t get their fair or expected share of trust assets.

• Conflict of interest when a trustee is also a beneficiary or acting in another professional capacity for the trust.