One of the critical tools for both DC plan sponsors and their outsourcing providers is the outsourcing contract. The contract serves three purposes.

  • First, and perhaps most important: During the process of negotiating the terms of the contract, the sponsor and the outsourcing provider can clarify the terms of their relationship.
  • Second, the contract serves as a guide to “who does what” – a roadmap for the outsourcing relationship.
  • Finally, a well-written contract should describe how any disputes between the parties will be resolved.
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