How Often Plan Sponsors Should Review Service Providers, and Why Timing Matters

One of the most common questions plan sponsors ask is simple:

The answer is less about a fixed rule and more about demonstrating a consistent, reasonable review process over time.

• “How often are we supposed to review our service providers?”

There Is No Magic Number, but There Is an Expectation

ERISA does not prescribe a single required timeline for reviewing service providers.

What it does expect is that sponsors:

• Monitor providers on an ongoing basis
• Periodically assess fees and services
• Re-evaluate arrangements when circumstances change
• In practice, the absence of a defined cadence often becomes a liability.

Common Review Cadences Sponsors Use

While every plan is different, many prudent sponsors follow a general framework:

Comprehensive evaluations or RFPs (every 3, 5 years) Deeper review of capabilities, pricing, and alternatives

These timeframes are not rules, they are signals of prudence.

• Annual check-ins High-level review of service quality, issues, and plan changes
• Periodic benchmarking (every 2, 3 years) Review fees and services against market peers

What Transparency Is Changing

Recent regulatory and litigation trends are pushing compensation into the open:

Sponsors are now expected to understand and evaluate these arrangements, not just receive them.

• CAA fee disclosure requirements
• Increased scrutiny of PBMs and carrier arrangements
• Greater focus on conflicts of interest
• As transparency increases, expectations change.

What Triggers an Earlier Review

Even if a regular cadence exists, certain events should prompt an immediate review, including:

• Significant fee increases
• Mergers, acquisitions, or ownership changes
• Service or performance issues
• Material changes to the plan or workforce
• Regulatory or litigation developments
• Ignoring these triggers weakens an otherwise sound process.

Why “Set It and Forget It” Creates Risk

Long-standing relationships can create comfort, and complacency.

Without periodic review:

Courts and regulators often focus on how long it’s been since a meaningful review occurred.

• Fees can drift above market
• Services may no longer align with plan needs
• Conflicts of interest may go unexamined

Monitoring Is Not the Same as Reviewing

Sponsors sometimes confuse:

Monitoring tracks performance. Review evaluates reasonableness, alternatives, and alignment.

Both are important, but they serve different purposes.

• Routine vendor meetings with
• Fiduciary review

How Documentation Fits Into Review Timing

Review cadence only matters if it’s documented.

Sponsors should be able to show:

A well-documented review from three years ago is far more defensible than an informal conversation last quarter.

• When reviews occurred
• What was evaluated
• What conclusions were reached
• Why decisions were made

What a Reasonable Review Schedule Achieves

A consistent review schedule:

• Demonstrates prudence
• Reduces reactive decision-making
• Strengthens negotiating leverage
• Provides clarity for boards and committees
• Most importantly, it creates confidence, internally and externally.

The Bottom Line for Plan Sponsors

The question isn’t whether you reviewed a provider recently.

The question is whether you can demonstrate:

• A thoughtful review cadence
• Responsiveness to change
• Clear documentation of decisions
• That’s what fiduciary oversight looks like in practice.

More Information You Might Find Interesting…

What It Means to Be a Fiduciary, and Why It Matters More Than Most Plan Sponsors Realize

Why Relying on Non-Fiduciaries Creates Risk, Even When Everyone Is Acting in Good Faith

What a Defensible Fiduciary Process Actually Looks Like for Plan Sponsors

Broker Compensation and Fiduciary Risk: What Plan Sponsors Need to Understand Now