Friday, June 02, 2006
Fiduciary Insurance for Hedge Funds
According to a recent story in HedgeWeek, hedge fund liability insurance may merit some serious consideration. Regulatory enforcement actions and investor lawsuits are on the rise, in the U.S. and elsewhere. Hedge fund directors are arguably more vulnerable than ever before, especially in areas such as valuation and trading controls.Bigger and more frequent claims make for unhappy insurance underwriters. The logical result? Higher premiums, reduced coverage and larger deductibles.
For pension fiduciaries with hedge funds on the shopping list, now might be the time to ask managers even more questions about their policies and procedures - content, frequency of review and revision, oversight and metrics for determining "errors".
After all, pension fiduciaries themselves are under more scrutiny and are unlikely to want to invest in a hedge fund or fund of fund with few or no documented policies and procedures. posted by Susan Mangiero at 6/02/2006 01:32:00 AM
PENSION RISK MATTERSSM focuses on pension financial risk issues from a governance and fiduciary perspective. The goal is to identify important topics, ask thought-provoking questions, examine best practices and encourage meaningful debate about the $10 trillion global pension industry upon which millions of individuals depend. Author and consultant Susan M. Mangiero, Ph.D. is a CFA charter-holder, Accredited Valuation Analyst, Accredited Investment Fiduciary Analyst and certified Financial Risk Manager. Dr. Mangiero combines many years of experience in finance with a keen interest in solving problems and simplifying the complex (
