Hiscox offers specialty coverages for asset management firms

Hiscox USA, a unit of Hiscox Ltd. is introducing a portfolio of policies that provide up to $5 million of primary or excess coverage for asset management firms including private equity funds, venture funds and hedge funds, the insurer said Tuesday.

The portfolio provides coverage for lawsuits alleging breach of fiduciary duty, fraud, insider trading, securities law violations, conflicts of interest and other common risks faced in this industry, the New York-based insurer said in its announcement.

Brian Hickey, New York-based senior vice president, financial services, for Hiscox USA, said, in an interview, “It’s a tailor-made policy, and by the nature of it we’ll be focusing on the small to medium-sized accounts” in order to “provide great service to a part of the industry that may often go neglected.”

“The complex U.S. regulatory environment, heightened with the passage of Dodd-Frank is increasingly exposing these firms to litigation from investors, portfolio companies, minority shareholders of portfolio companies, regulatory agencies, employees and a number of other third parties,” said the company in its announcement.

In addition to providing up to $5 million in primary or excess coverage, the policies include a complimentary risk management service. Along with the standard management liability, professional liability and outside position liability coverages, which apply to fund employees who serve on the boards of other companies, clients can also choose to add on any combination of employment practices liability, fiduciary liability and employed lawyer’s coverage under a single portfolio policy, Hiscox said in its statement.

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