Venture Capital Liability Policy

What is a Venture Capital Liability Policy?

This type of policy offers venture capital and private equity firms an effective, comprehensive way to transfer and mitigate many of their most significant liabilities by combining four coverages into one policy:

  • Management Liability Insurance
  • Management Indemnification Insurance
  • Outside Directorship Liability Insurance
  • Professional Services Liability (Errors and Omissions) Insurance

What Limits should I buy?

There is no firm answer about how much venture capital liability coverage a company should purchase. It is very difficult to buy enough insurance to adequately cover all possible losses. The goal is to try to purchase a reasonable amount of coverage based upon operations and perceived risks. Two major factors contribute to a company’s level of risk:

  • The general size of the organization. The bigger the company the bigger the target.
  • The number of employees and the potential for employment liability claims.

Why should I buy it?

The Venture Capital Liability policy effectively addresses the needs of many types of private investment firms that manage other types of funds, including:

  • Small business investment company funds
  • Corporate-sponsored funds
  • Fund of private equity/venture capital funds
  • Distressed debt funds
  • Mezzanine debt funds
  • Government-sponsored funds

The National Venture Capital Association (NVCA) and TechAssure (of which Diversified is a member) have partnered to provide NVCA members with VentureInsure, a suite of comprehensive insurance coverages and risk management services designed to protect venture capitalists and their investments.

As part of VentureInsure, Diversified Insurance Brokers will work with NVCA member firms and their Portfolio Companies on an individual or portfolio basis, from start up through maturity, to ensure complete protection from the myriad of risks facing emerging growth companies and their directors and officers today.

VentureInsure offers a comprehensive suite of insurance products for NVCA members and their portfolio companies:

  • Directors & Officers Liability Insurance
  • Employee Benefits
  • Employment Practices Liability Insurance
  • Errors & Omissions Insurance
  • Intellectual Property Insurance
  • International Insurance
  • Network Risk Insurance
  • Key Man Life Insurance
  • Property Insurance
  • Products Liability Insurance
  • Personal Insurance
  • Representations & Warranties Insurance
  • Workers Compensation Insurance

Associations

About TechAssure
TechAssure is an international association of privately held, entrepreneurial insurance and risk consultants specializing in mitigating the risks faced by emerging growth companies and the venture capital firms that back them. TechAssure members are committed to providing uncompromising service and unbiased professional advice for their clients. TechAssure member agencies service more than 3,000 technology and life sciences companies worldwide
About the NVCA
The National Venture Capital Association (NVCA), representing approximately 450 venture capital and private equity firms, seeks to foster greater understanding of the importance of venture capital to the U.S. economy, and support entrepreneurial activity and innovation. The NVCA represents the public policy interests of the venture capital community, strives to maintain high professional standards, provides reliable industry data, sponsors professional development, and facilitates interaction among its members. For more information, visit www.nvca.org.