The Hartford Financial Services Group is offering a modular professional and management liability insurance policy for private equity firms and those with similar risks.
The company said that the Hartford Private Equity Choice Policy is designed to safeguard private equity funds and protect fund managers from the types of exposure arising from their different roles as professional investment advisor, fiduciary and employer.
According to Hartford Financial, the key features of Private Equity Choice Policy include a one-stop approach that allows equity fund managers to go to a single source for their management liability, employment practices liability and fiduciary liability coverage; and allocation provisions that delineate how the advancement and allocation of defense costs are handled separately from the allocation of damages.
In addition, the policy features a multi-faceted definition of professional services and a provision that specifies whose knowledge is relevant to determine when the insured has a notice of claim.
Amit Dave, assistant vice president of financial products underwriting for The Hartford, said: “Managing a private equity fund offers a significant opportunity for financial reward, but the risk of costly litigation can also be substantial. Lawsuits can arise from many sources, including limited partners, portfolio companies and their shareholders, and even a firm’s own employees.”
Mr Dave said that the policy combines the basic types of liability protection that private equity firms need, including fund management liability coverage, with market-specific policy wording and optional features such as fiduciary liability coverage, to help the firms insure against risks. The modular approach allows a firm to select coverage options that best suit its needs.
He added: “The Hartford Private Equity Choice incorporates many key provisions in a single, easy-to-navigate policy, so clients no longer need to wade through various endorsements. This is particularly important for fund managers who need a policy that addresses several different types of liability exposure.”