Over the last two decades the hedge fund industry has experienced an explosion in popularity by many institutional and individual investors and reached heights unimaginable by many experts.
Recent estimates have reported that there are over 8,000 hedge funds in existence with assets under management (AUM) of more than $2.5 trillion AUM. The industry, considered a relative newcomer in the world of finance, has a landscape that is forever changing.
While managing a fund can bring enormous wealth and prestige, it can also create a world of limitless exposure. With increasing scrutiny from regulators and limited partners, hedge fund managers are now faced with exposures rarely seen or experienced before.
Common allegations include:
- An unintentional omission or misleading statement in the offering memorandum
- The failure to meet expectations of the limited partners
- Breach of fiduciary duty to the limited partners
- Conflict of interest
- Investment returns fall short of expectations, and limited partners allege securities act violations
- Employment Practices Liability claims
What insurance do you need?
- Coverage for the fund for claims brought by limited partners, competitors, regulatory agencies and companies in which the fund may invest
- Protection for the general partner and fund manager in their professional or fiduciary capacity
- Directors and officers liability insurance for the D&O’s of the Fund and Fund manager
- Professional Liability protection for the Fund manager for claims arising out of professional services rendered on behalf of the fund
Our experience, creativity and solutions oriented approach allows Krauter & Company to tailor insurance products that meet your unique needs. We have a high degree of understanding the risks and challenges associated with managing a hedge fund. We combine our technical and financial skills to help structure insurance programs suited specifically for hedge funds.