Custodia Financial is the leader in Retirement Loan Protection (RLP) — insurance that automatically prevents 401(k) loan defaults when participants lose their job, become disabled, or pass away.
401(k) loans work until a job ends. Then the loan comes due, most borrowers can't repay, and the default triggers taxes, penalties, and permanent retirement leakage. Research shows 86% of participants with an outstanding loan default upon separation, and two-thirds cash out their entire account. EBRI's analysis of 27 million participant records found nearly $2 trillion in retirement savings could be preserved through auto-enrolled loan protection.
RLP closes this gap at the plan level. Benefits are paid directly into the plan, keeping the participant's account — and the employer match — whole, with no change to daily plan operations and no participant action required. Coverage averages just 3–6 basis points annually and can be funded from the plan's forfeiture account.
The industry has taken notice: EBRI has advocated for loan protection, and DCIIA's 401(k) Benchmarking Study names protecting loans with insurance as a key takeaway for reducing defaults and improving retirement outcomes.
We work with plan sponsors, CFOs, fiduciaries, retirement plan advisors, recordkeepers, and TPAs to make loan protection an automatic feature of defined contribution plans — protecting employees, employer contributions, and fiduciary standing in a single move. Every loan. Automatically protected. Learn more at custodiafinancial.com.

Custodia Financial

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