Portfolio Management

The Private Equity and M&A team at Marsh provide risk advice and tailored insurance solutions for private equity, infrastructure and real estate funds, and the portfolio companies that they invest in.

Private Equity Management Liability (PEML)

A PEML policy protects a fund against the potential liabilities it may face and can incorporate directors’ and officers’ liability, professional indemnity and crime cover.  Liabilities originate from many sources and have become increasingly complex in nature. Our specialist wording technicians, new product development capability, and claims advocates enable us to design bespoke policy wordings to address our clients’ needs and keep up with changing legislation. 

Portfolio Company Management Liability (Directors & Officers Liability)

A directors and officers (D&O) policy covers claims made against directors and officers for wrongful acts. When a company receives fund investment this impacts their D&O risk profile and corporate structure. We provide tailored D&O wordings that include specific enhancements to reflect this. A standard insurer policy may fail to pick up the nuances of fund investment leaving directors exposed. 

Other Fund Insurances

We can assist with other corporate insurance requirements such as property damage/business interruption, employers’ and public liability, motor fleet, and business travel insurance.

Property, Business Interruption, and Liability Insurance for Private Equity Portfolio Companies

Companies with private equity investment will see their risk profile change as the business grows, potentially makes further acquisitions, or diversifies and expands internationally. They may also have strict debt covenants and be more vulnerable to cash-flow volatility as a result. With this in mind, we have designed a tailored insurance solution to better protect companies with private equity investment.

Portfolio Insurance Procurement for Funds

Using premium aggregation as the basis for negotiation could save up to 30% on portfolio-company premiums in the first year. Our brokers generate competition among insurers, helping portfolio companies sustain better-than-average insurance market rates where possible, improve insurance coverage, and gain access to best-in-class risk management practices.

Public Offering of Securities Insurance (POSI)

A POSI policy responds to the risks associated with an initial public offering (IPO) (or bond offering) faced not only by the directors of the issuer, but also the issuer itself and any controlling or selling shareholders including exiting private equity investors. A POSI policy operates to ring-fence the IPO exposure allowing the D&O policy to respond to “business as usual” risks faced by the directors.

Cyber

A key concern of many of our fund clients is the potential for financial loss and reputational damage to a portfolio company as a result of a cyber related incident. Associated with this is the European Union’s (EU) General Data Protection Regulation (GDPR) which took effect in May 2018 — as combined drivers these have served to push “cyber” in the widest context to the top of many firms’ agendas.

Through our Client Advisory Services we are able to engage in processes to review the susceptibility of portfolio companies to cyber-attack, propose risk management actions which can be taken to help mitigate risks, undertake gap analysis in relation to existing insurance protection, and thereafter recommend suitable portfolio wide or standalone cover as necessary. Marsh’s proprietary cyber insurance products provide additional crisis support to assist policyholders who may not have resources or the necessary in-house expertise to respond quickly, in order to encourage swift recovery and/or compliance with GDPR loss of data reporting requirements.

Employee Health and Benefits

Through the Marsh & McLennan Companies group we can work with funds to address the often varying needs of their investment director-level and administrative support staff, as well as arranging portfolio wide and individual programmes for portfolio companies.

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