Are there penalties for failing to provide timely COBRA notices?

• A. Yes; failure to comply can trigger ERISA penalties and potential civil actions.
• B. No; there are no penalties.
• C. Only if there is a lawsuit from a beneficiary.
• D. Penalties apply only in certain states.

Answer: (A)

The key idea is that COBRA notices are a required fiduciary duty under ERISA. When a plan administrator fails to provide the initial and election notices within the required timeframe, it breaches that duty. ERISA allows penalties for failing to furnish required information or comply with disclosure rules, and beneficiaries can pursue civil actions to enforce rights or recover damages. So, penalties can arise and actions by beneficiaries or the government can follow. This isn’t a state-only issue, and it isn’t a matter of absent penalties or only happening in a lawsuit in isolation—the federal enforcement framework for ERISA fiduciaries covers these notices, making penalties possible and civil enforcement available.