D&O Insurance for Private Funds & Venture Capital

D&O and management liability for private funds

Private equity firms, venture capital funds, hedge funds and family offices face claims that ordinary business policies were never built for: limited partners challenging decisions, regulators asking questions, portfolio company disputes and partners named personally because they sit on portfolio boards. A fund management liability program brings the right coverages together for the fund, the general partner and the management company.

Gordon Companies is an independent, family-owned brokerage working out of Midtown Manhattan since 1968. We compare management liability options across carriers and explain the differences in plain English, so your team understands what the policy will and will not do before you need it.

What a fund program usually includes

• Directors and officers / general partnership liability (GPL): claims against the fund, the GP, the management company and their partners and officers.
• Professional liability (E&O): allegations that investment or management services were performed negligently.
• Outside directorship liability (ODL): protection for partners and employees serving on portfolio company boards, usually excess of the portfolio company's own D&O.
• Employment practices liability (EPLI): claims by employees of the management company.
• Crime and social engineering: theft, wire fraud and funds transfer fraud.
• Cyber liability: data breaches and ransomware affecting investor or deal information.

Venture capital and private equity are different

Venture funds typically hold many board seats in early-stage companies whose own D&O may be thin or nonexistent, which makes outside directorship coverage central. Private equity firms often control portfolio companies and face claims around acquisitions, dispositions and bankruptcies. Hedge funds and credit funds focus more on investor and regulatory exposure. We structure the program around how your fund actually invests.

Details that matter in a fund policy

• Who is insured: the fund, the GP, the management company, partners, employees and advisory board members.
• Investigation coverage: costs of responding to regulatory inquiries before a formal claim exists.
• Indemnification order: whether the fund's assets or the policy responds first, which matters to limited partners.
• Portfolio company exclusions and how ODL coordinates with each company's own D&O.
• Fund formation and wind-down: coverage while raising new vehicles and after a fund stops investing.

How we shop your program

We gather your fund documents, structure and history, then compare terms across carriers and highlight where policy language differs. We also review the D&O carried by your key portfolio companies, because their coverage affects how well your partners are protected.

Questions we hear from fund managers

Do we need D&O if we are a small emerging manager?

Yes. Investors and portfolio companies increasingly expect it, and early claims are often defense costs over disputes, which can be expensive without coverage.

What is outside directorship liability?

Coverage for your people when they serve on a portfolio company's board. It usually sits above that company's own D&O and can respond if that coverage is exhausted or does not apply.

Can the fund pay the premium?

Often part of it, depending on your fund documents and which entities the policy protects. We can help you think through the allocation.

How long does placement take?

Plan for several weeks for a new program, more for a first-time fund. Starting before your first close gives you the most options.

Related coverage

• Directors & officers (D&O)
• Professional liability (E&O)
• Employment practices (EPLI)
• Cyber liability
• Risk management
• All commercial insurance

Get your fund D&O quote

Start with a few details on our quote page, or call 212-687-2525 Monday through Friday, 9am to 5pm. A real person on Aaron Gordon’s team will review what you have, compare carriers and walk you through the options.