"Managing a private equity fund offers a significant opportunity for financial reward, but the risk of costly litigation can also be substantial," said Amit Davé, assistant vice president of financial products underwriting for The Hartford. "Lawsuits can arise from many sources, including limited partners, portfolio companies and their shareholders, and even a firm's own employees."
According to Davé, Private Equity Choice was developed in direct response to feedback from members of this highly specialized market as part of The Hartford's growing portfolio of tailored products for businesses in the financial services sector. The policy combines the basic types of liability protection that private equity firms need, including fund management liability coverage, with updated market-specific policy wording and optional features, like fiduciary liability coverage, to help these firms insure against a variety of risks. The modular approach allows a firm to select coverage options that best suit its needs.
"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," said Davé. "This is particularly important for fund managers who need a policy that addresses several different types of liability exposure."
Key features of The Hartford 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.
* Allocation provisions that delineate how the advancement and allocation of defense costs are handled separately from the allocation of damages.
* A multi-faceted definition of professional services.
* A provision that specifies whose knowledge is relevant to determine when the insured has a notice of claim.