Insurer Offers Protection For Hedge Fund Asset Freezes

Jun 30 2008 | 9:07am ET

A New York insurer is offering hedge fund fraud protection, the first such product sold by a U.S. firm.

Integro Insurance Brokers began offering the policy today. Unlike the first such hedge fund insurance product, unveiled by London-based Protean in January, the new policy will only cover fund whose assets have been frozen by regulators.

“Over the past two years we have spoken to dozens of institutions that have expressed frustration about their inability to get their capital back within five years in the case of a blow-up,” Michael Klaschka, managing principal at Integro, told the Financial Times.

Integro says their service will cost less than 0.2% of the value of an investor’s portfolio. The firm will require investors to insure their entire hedge fund portfolio, and have engaged risk-rating agency Amber Partners to investigate each fund before opening a policy.

Protean reportedly insures some $10 billion in assets, with as much as another $30 billion in the works.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...