Investment Management Insurance

CMX understands the expectations and pressures placed on investment managers and fund managers. Regulatory and compliance obligations are greater than ever and investors’ preference to bring actions against fund managers and their directors is becoming more frequent.

Risk Specialists

Complimentary policy reviews

No hidden fees

What are the risks faced by Investment Managers?

Investment management is a complex beast. In the current environment of:

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Financial Market volatility and declining returns

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Sale of unsuitable financial products

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Complex investment schemes and expanding capital flows

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Improved investor knowledge; and Tighter regulatory controls

one mistake can bring about unforeseen litigation costs and undermine the fund managers’ performance, and the returns of the funds they manage.

Investment managers are likely to owe duties, as both company officers and as professionals, to shareholders, investors, employees, regulatory agencies and other third parties. A breach of duty may lead to claims from any or all of these parties.

What is Investment Managers Insurance (IMI)?

IMI is specifically designed for investment managers to address their professional liability, management liability and crime exposures. It protects investment advisors/managers and funds when providing investment advisory services, and it protects the fund and its advisors from the theft of funds.

Who can benefit from Investment Management Insurance?

Responsible Entities, Investment Managers, Fund Managers, Asset Managers, Investment Advisors, Venture Capitalists, Private Equity firms, Hedge Funds, Sovereign Wealth Funds

Case Study: Investor suing for loss of investment

The insured fund specialised in attracting foreign nationals to invest in Australian property related funds to enhance their visa prospects.

The Claimant invested $4.5M in the property fund on the basis that at the time the Fund allegedly knew the property was valued at $13M.

Following the investment, the Fund made a loan of $17M to a property developer. The Claimant was allegedly told if the property developer defaulted on the loan, the Claimant would have first rights to the subject property.

The property developer borrowed further money from a separate lender which included a mortgage over the property. The property developer defaulted on the loan and the property was repossessed by the finance company.

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