The credit crunch and wave of credit hedge fund collapses has spurred hedge fund and fund of hedge funds managers to take out insurance or reassess their existing policies. Robert Kelly at London-based insurance brokers Baronsmead estimates that fewer than 10% of hedge fund managers in London have no directors and officers (D&O) cover. Under this cover, if investors are unhappy with a fund and seek to make claims against it, the directors’ assets will be protected. "Now, however, and in particular with the push to have independent directors, we are seeing managers take a closer look at the quality of their cover," says Kelly.
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