Iron Cove Partners (ICP) is a leading full-service national insurance brokerage firm serving the financial services industry. Headquartered in Garden City, Long Island, ICP is a trusted advisor with decades of experience and over 150 hedge funds as clients.
ICP specialises in meeting the unique insurance demands across all areas of the financial services industry including: investment advisers; hedge funds; private equity funds; mutual funds; broker-dealers, and investment banks.
Louis D’Agostino is Principal of Financial Services practice at Iron Cove, which provides expertise to hedge funds, registered advisers, private equity funds, broker-dealers, and mutual funds. 2017 was another great year with D’Agostino confirming that ICP were able to exceed their new business goals, “all while providing our clients in most cases with premium reductions. We also had a successful rollout of our new Hedge Fund D&O/E&O Product which gained a lot of interest.”
Discussing how hedge fund managers view insurance, D’Agostino believes that most view insurance protection as something that is better to have and not need than to need and not have it.
“While most professional lines of coverage remain elective and not required by law/regulation, I think most funds, once they hit critical AUM milestones, or for really large new fund launches, see it as a must have and best practice,” says D’Agostino, who continues: “Our mission of educating, empowering and protecting is something we believe strongly in. Many of our fund clients are not “insurance experts” nor should they be. It’s our job during the proposal process to provide a high level of education around all coverage elements and possible claims scenarios.”
One obvious trend in recent times has been the rise to prominence of cyber insurance. This is set to continue to evolve and financial institutions will continue to evaluate this ever-increasing risk. Regulators see insurance protection as an integral part of a robust cybersecurity program “and we couldn’t agree more,” comments D’Agostino. “The opportunity for us is more in tailoring existing Cyber Products specifically for financial institutions. Not all Cyber Coverage is created equal, nor does all Cyber coverage apply to asset management firms.
“Most clients that take cybersecurity seriously are conducting cybersecurity assessments, penetration tests, vendor due diligence as well as putting incident response plans in place. Those managers also see the value of Cyber Insurance as a compliment to a well implemented and robust cybersecurity program.
“As stated above, our goal is to navigate our clients through the cyber coverage maze and to discuss the elements of coverage that are more applicable to the operations of asset managers, which will ultimately drive home the value.”
Social engineering coverage is a critical consideration nowadays, given that the loss of customer capital resulting from such an attack can be catastrophic for small and mid-sized managers.
D’Agostino confirms that while typical cyber protection will provide coverage for the related costs that a fund may incur in response to a cyber event (crisis management, incident response, forensics, e-extortion, etc), “only a Crime/Fidelity Bond with Social Engineering coverage will provide reimbursement for the loss of customer capital. This scenario, while it appears unlikely, is perceived as a much more substantive risk and one that appears to get everyone’s attention,” he says.
On winning this year’s award, D’Agostino comments: “We set out to build a Global Financial Services Practice and winning this award for the second year in a row affirms that we are headed in that direction.”
