Investment Funds

Investment funds drive innovation, create jobs, and foster economic growth by providing crucial capital to early-stage companies and established businesses, enabling them to enhance performance, develop innovative technologies, and expand.

eSpecialty provides expert guidance and insurance solutions tailored to business investment funds, including venture capital, private equity, real estate, and hedge funds, as well as special purpose vehicles (SPVs).

Protect Your Fund

Why Do You Need Insurance?

Investment funds need insurance to protect against claims from investors, portfolio companies, individuals, and other organizations.

Protection

Insurance provides financial resources to respond to serious events, such as lawsuits and cyber breaches.

Portfolio Companies

Portfolio companies may not maintain adequate insurance, putting fund principals at risk.

LP and Other Requirements

Investors in your fund, directors, and partners may require insurance such as Errors & Omissions (E&O), Directors & Officers (D&O) and Cyber Insurance.

Defense Costs

Insurance is a critical source of funding for expert counsel, even when a claim has no merit.

Risk Mitigation

Pre- and post-loss expertise and services can help prevent claims and reduce loss costs. These services are vital for cyber exposures.

Regulatory Requirements

Regulators may have insurance requirements. A fund may be required to have an ERISA bond, and Workers' Compensation is required for an organization with employees.

Ensuring your organization has the correct insurance coverage at a reasonable cost requires experience and expertise. We can help.

E&O/D&O Insurance

Errors & Omissions (E&O) and Directors & Officers (D&O) insurance is vital and is typically written on a combination policy form for investment funds. These policies are tailored to the unique structure and role of business investment funds, and are sometimes called blended or combined policies, and VCAP (Venture Capital Asset Protection). Forms may vary based on the underwriter providing coverage and unique fund needs.

eSpecialty offers a select E&O/D&O insurance program for emerging funds and SPVs, called the Emerging Fund/SPV Insurance Program. See our Emerging Fund/SPV Insurance Program for details.

Other Recommended Coverages

Fund insurance is not the only essential coverage – other solutions include:

Cyber Insurance

Protects against data breaches, ransomware attacks, fraudulent funds transfer (FFT) incidents, and related liabilities.

Crime/ERISA Bonds

Crime covers theft of funds, and any organization responsible for large sums has a need. Some funds may be required to procure an ERISA bond.

Employment Practices Liability (EPL)

Covers employment-related claims and is particularly important for funds with multiple partners and employees.

Standard Coverages

General Liability (GL), Workers' Compensation (WC), and other standard insurance coverages are necessary as funds grow.

Special Situations

New Funds

First-time funds can have unique requirements. eSpecialty can help develop a plan for obtaining coverage that aligns with your fund startup path, including timing the purchase of insurance with your investing and fundraising timelines. Access to our Emerging Fund/SPV Insurance Program is also available.

Non-Core Products/Services

Funds and related companies may provide services unrelated to investing activities, and these services may need to be covered separately from fund insurance. An example is the provision of unrelated consulting services to organizations in which the fund has no financial interests.

Special Purpose Vehicles (SPVs)

SPVs are separate legal entities designed to isolate financial risk and enable pooled investments in specific projects or business activities. The use of an SPV can streamline the investing process and simplify cap tables. Depending on the use and structure, SPVs can operate like investment funds and may need fund coverage and other insurance. SPVs are contemplated covered entities, along with investment funds, in the Emerging Fund/SPV Insurance Program.

Portfolio Companies

Portfolio companies are a primary source of exposure – do your portfolio companies have adequate coverage to protect your investment? Cyber insurance is one example where portfolio companies can be significantly underinsured, and an incident can have a significant impact on operations. We can help you assess the proper coverage.

Why Choose eSpecialty?

Expertise

Our experience in specialty insurance markets ensures competitive coverage solutions.

Access

Effective placement of specialty insurance requires experience and access to specialized underwriters.

Reliability

We will find solutions for all your unusual, complex or challenging insurance exposures.

Ready to protect your fund? Contact us at [email protected] to get started with tailored coverage that fits your needs.

Note: Insurance policies are not all the same. Some policies are more comprehensive than others, and some policies provide broader coverage in specific areas. In addition, each insured may have different exposures and coverage needs. We encourage you to read your policy and consult with an insurance expert such as eSpecialty Insurance.