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Understanding the Need for Search Funds to Add Co-Defendant Language to their D&O Policy White Paper

In light of the increasing popularity of Search Funds and investors exclusively dedicated to this class of private equity, the importance of properly structuring an Executive Liability (Directors' & Officers', Employment Practices Liability, Fiduciary, Crime) policy has never been higher.  Executive Liability is not an "off the shelf" insurance product and each endorsement and the various coverage enhancements require careful consideration. Today, we are going to bring more clarity to the "Co-Defendant Extension" endorsement.

Why the need for a Co-Defendant endorsement?

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Healthcare Cyber Security White Paper

We recently came across a quote at a cyber forum which said "A computer lets you make more mistakes faster than any other invention in human history, with the possible exception of handguns and tequila." This has never been more appropriate to describe the current environment of network security. 

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Product Recall White Paper

Humans in the manufacturing process, regulatory standards increasing, product safety rules increasing, and more stringent product quality obligations are just some of the reasons that Product Recall coverage should be considered by commercial insurance buyers.  Product Recall insurance is a unique coverage that reimburses for the financial loss incurred during the recall process.  

Product Recall coverage has two parts to its policy form, First Party Expenses, or the expenses of the entity, and Third Party Liability losses associated with your client or vendor.

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Cyber Liability Insurance: Why HR Professionals Should Drive the Purchasing Decisions White Paper

The success of a Human Resources department is measured in a lot of ways. None more important than the level of trust that the HR department has with its employees. Employees must feel as though they can trust the HR department with: 

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Cyber Crime Alert White Paper

Over the past few weeks, our clients have advised us of several circumstances where their sensitive, personnel information was sent to an unknown third party.  In the two most recent situations, Client #1 had over 900 records affected and Client #2 had about 80 records affected.  The breach cost for Client #1 is estimated to be around $60,000 and the estimated breach cost for Client #2 is about $70,000.

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Using Insurance Capital to Enhance Deal Terms and Mitigate Risk White Paper

We all know the M&A world of today is much different from that of 10 or even 5 years ago, with blurred sector lines and perpetual disruption spurring many companies to find ways to stay ahead of their competitors.

"From my perspective, the M&A business is more complicated than it's ever been," says Chris Veber of Equity Risk Partners. "Folks are doing anything they can - both buyers and sellers - to get the competitive edge."

Below, Chris outlines two relatively new and innovative transactional insurance products being used to drive and support M&A activity - tax indemnity and litigation containment insurance - and the pros and cons behind it.

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Workers' Compensation and "Other States" Coverage White Paper

A Workers' Compensation policy contains three parts:

  • Part A: Workers' Compensation
  • Part B: Employer's Liability
  • Part C: Other States Insurance 

Part A, Workers' Compensation, covers the statutory benefits required by those states listed. Part B, Employer's Liability, covers actions not covered under workers' compensation benefit laws such as gross negligence, and third-party-over suits. Part C, Other States Insurance, is often overlooked. It provides coverage for an insured's employees traveling through or temporarily working in states other than the insured's home state, or those states in which the insured operates. It extends  the policy so that an injured employee can receive statutory benefits as prescribed by the other states listed on the endorsement.

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Lease "Do's and Don'ts" White Paper

What are Contracts:

Contracts are a tool used to enable two parties to produce a legally binding agreement enforceable by law. There are several types of contracts, but for our purposes, we will limit our comments to leases. Leases specify the responsibilities of the lessor and lessee and is the document courts will rely on should a claim arise for the location outlined in the lease. Therefore, leases are important and should be reviewed carefully prior to signing. 

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Cyber Liability: Data Breach Response White Paper

Contrary to popular belief, cyber breaches will have an effect on nearly every business, if they have not already. In fact, Cyber Liability has garnered so much attention in recent years that in 2015, the White House press secretary noted that "cyber security threats and identity theft continue to rise... nine in ten Americans feel that they have in some way lost control of their personal information." The procurement of Cyber Liability insurance is occurring increasingly in efforts to combat the rapidly growing cyber exposures businesses are facing, and mitigate losses that may result when businesses engage in electronic activities, such as Internet sales and/or data collection within its internal networks. The policies cover a variety of expenses associated with data breaches, including notification costs, credit monitoring, defense costs, regulatory fines/penalties, and loss resulting from identity theft.  

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The Adoption of Telehealth White Paper

Healthcare reform has driven a significant interest towards the use of Telehealth as a solution to reduce the cost of care while increasing accessibility. Equity Risk Partners is witnessing Telehealth's embrace by employers, providers and patients. For patient education, preventative care, and as an administrative means for health care providers to communicate, Telehealth is gaining momentum in the health care industry as an efficient method to diagnose and treat patients.

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The Ins & Outs of Going from Guaranteed Cost to a Loss Sensitive WC Program White Paper

Helpful Tips and Tricks:  Moving from Guaranteed Cost to Loss Sensitive Program

At your next Workers Compensation renewal, your broker may present you with options for a "Guaranteed Cost Program" and a "Loss Sensitive Program." The purpose of this paper is to help you understand your claims exposure for the different types of programs. These tips are intended to help you manage your claims costs on a Loss Sensitive Workers' Compensation Program. Keep in mind, state rules may differ. Your claims advisor can provide additional insight and assistance.

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Cyber Liability White Paper

Cyber Liability is emerging to be at least as threatening a risk as Employment Practices Liability.  While EPL is a risk often borne of some form of ignorance, Cyber is a risk founded on malicious intent seemingly offering perpetrators the allure of easily - accessed, anonymously - obtained and effectively - hidden liquid assets. Be those assets Personally Identifiable Information (PII) and / or Valuable Papers caused by a breach, the extortive threat of a destructive system outage and / or the malicious act of a rogue employee, the risk environment is rapidly evolving.

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Healthcare Reps & Warranties Insurance: Providing Coverage for Regulatory Compliance White Paper

Representations and Warranties (R&W) insurance is designed to cover losses resulting from the breach of a Seller’s representations and warranties within a purchase agreement, typically used to:
• Replace traditional indemnification and escrow under a purchase agreement
• Supplement / Increase the existing indemnification limit and terms
• Backstop a Seller’s existing indemnification and corresponding escrow requirements

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Transactional Risk and Reps & Warranties Insurance Market Update, Q1 2017 White Paper

Representations and Warranties (R&W) insurance is designed to cover losses resulting from the breach of a Seller’s representations and warranties within a purchase agreement, typically used to:
• Replace traditional indemnification and escrow under a purchase agreement
• Supplement / Increase the existing indemnification limit and terms
• Backstop a Seller’s existing indemnification and corresponding escrow requirements

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Insurance Company Consolidation: Market Update and Implications Partners' Perspective

In the words of the great Michael Scott from the NBC show, The Office, "The word 'merger' comes from the word 'marriage'. That was what today was supposed to be - the loving union between people. Instead, it has become like when my Mom moved in with Jeff. And, once again, it becomes my job to fix it."   Mergers and acquisitions can be complicated, but that has not stopped the insurance industry from producing its fair share of them lately.

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Navigating from Private to Public - Keys to a Successful Transition Executive Advisory Series

Please join us on Wednesday, September 30th, at 2:00pm EST, as RT ProExec provides their insights of the Executive Liability market for private companies considering an IPO. RT ProExec will highlight the fact that not all coverage is created equal when it comes to Executive Liability.

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Reps and Warranties Insurance Videos 'On The Go' - Equity Risk Partners R&W 2.0 Product Overview

Equity Risk Partners has built a video tutorial series on R&W Insurance in order to provide insight into the ever evolving transactional insurance markets. We believe this video tutorial series will be both informative and entertaining. It will allow you to watch our videos from your mobile device, enter.....R&W 2.0.

 

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Terrorism Risk Insurance Act Set to Expire December 31, 2014 -- FAQs on TRIA Expiration Article

We want to keep you informed of recent developments regarding the Terrorism Risk Insurance Act (TRIA).  TRIA was created as a result of the 9/11 terrorist attacks. The act created a federal backstop for insurance claims related to terrorism events in the United States.

Despite bipartisan support for the program, and previous TRIA extensions passing both the Senate and House by huge margins, the Senate recently adjourned without voting on final passage of a long-term TRIA extension.

The bill was blocked in the Senate over concerns with add-on provisions related to the Dodd-Frank Act and the creation of a National Association of Registered Agents and Brokers. While these provisions were unrelated to the TRIA program itself, the objections were enough to derail the entire legislation. As a result, TRIA will expire on January 1, 2015. 

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Cyber Deception - A New Threat to Small/Medium Size Companies Emerging Threat

We have recently seen a wave of claims from clients involving fraudulent fund transfer requests from senior executives. At a time when the executive is out of town, an email is sent from a fake email account to the CFO or Controller with instructions to wire funds – typically $35,000 or more – to a bank account.  By the time the executive gets back to the office and the scam is discovered, the money is long gone.

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Your Insurer’s Marketing Materials May Hold the Key to Your Insurance Case Article

We have all purchased products or services based on claims made in marketing and advertising about what we are buying. But buying insurance for a company is very different from buying something that promises to make you look younger. In fact, the marketing materials used by your insurer may be a key element of a claim to collect the money you or your portfolio company deserve from your insurance coverage.

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Representations & Warranties Insurance Overview Product Overview

Equity Risk Partners maintains a blog of Transactional Products success stories that allows our clients to read about how these products are adding value to transactions around the world.  The most common products are Reps & Warranties, Contingent Tax Liability, and Litigation Buyout.

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Join us for the First Ever Live Transactional Insurance Products Twitter Chat Executive Advisory Series

Equity Risk Partners continues to lead the way in keeping clients informed on insurance products that can add value to private equity transactions.  Join us on Thursday, August 14, 10-11 am PDT, for the first ever live Twitter chat focused on transactional insurance products in private equity transactions.  Use hashtag #TransRisk.

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Global Due Diligence Coordination - Why Using Local Providers Matters White Paper

More than ever, private equity firms and portfolio companies are looking outside of their home country for their next acquisition, and it is not just the Mexico or BRIC’s (Brazil, Russia, India, China) anymore. Locations like South Africa, Turkey, Latin America, and the Middle East are being mentioned in conversation as often as Florida, California, New York and Missouri.

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Why Choosing an Insurance Broker Isn't as Easy as "Whoever Brings Us the Best Price Wins" Partners' Perspective

In many financial decisions, be they business or personal, cost will be the most important, if not the only determining factor. This is particularly true when the decision revolves around the purchase of a product or service deemed to be a commodity, a characteristic often attributed to both insurance and insurance brokerage services.

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AIG Multinational Global Brief - July 2014 Global Brief

AIG Multinational, in collaboration with Business Monitor International, has introduced the Global Brief. This monthly publication is distributed to AIG's multinational clients. Equity Risk Partners can distribute this document due to our membership in the Worldwide Broker Network.

The Global Brief provides forward-looking and corporate investor focused insights on global trends, political risk “hotspots”, business environment developments, as well as key investment and commercial growth opportunities. The data is provided across 24 industries, with an emphasis on emerging/frontier markets, in the form of a brief synopsis with the option to read the full content free of charge.

The Global Brief is designed to generate discussions and thought leadership on global growth strategies amongst our clients and brokers. Email jwarren@equityrisk.com with any questions or feedback on this document.

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The Art, Science, and Reality of Projecting Insurance and Employee Benefit Costs in a Private Equity Transaction White Paper

The costs associated with purchasing adequate insurance coverage and providing employees with competitive health and welfare benefits may be a significant portion of a company's annual operating expenditures. For a private equity firm, the ability to understand and accurately forecast these costs post-transaction can be an important factor in the success or failure of an investment.

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AIG Multinational Global Brief - June 2014 Global Brief

AIG Multinational, in collaboration with Business Monitor International, has introduced the first edition of the Global Brief. This brand new, monthly publication is distributed to AIG's multinational clients. Equity Risk Partners can distribute this document due to our membership in the Worldwide Broker Network.

The Global Brief provides forward-looking and corporate investor focused insights on global trends, political risk “hotspots”, business environment developments, as well as key investment and commercial growth opportunities. The data is provided across 24 industries, with an emphasis on emerging/frontier markets, in the form of a brief synopsis with the option to read the full content free of charge.

The Global Brief is designed to generate discussions and thought leadership on global growth strategies amongst our clients and brokers. Email jwarren@equityrisk.com with any questions or feedback on this document.

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Insurance Premium Finance White Paper

Insurance premium financing is the solution for companies whose insurance carriers require that the policy premium be paid in full at inception. While many insurance carriers will offer their insurers payment options, there are still those that do not offer alternate payment terms.

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Houlihan Lokey Professionals to Provide an Overview of the Food & Beverage Industry Executive Advisory Series

On Tuesday, June 17th, Houlihan Lokey's team of experts provided a brief overview of the food & beverage industry, including market insights, recent M&A activity, key valuation metrics and sector trends.

If you would like more information please contact Chris Veber at cveber@equityrisk.com or (312) 980-7856.

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Lincoln International Professionals to Provide an Overview of the Packaging Industry Executive Advisory Series

On Tuesday, January 28, 2014, Luke Webb and Andy Schwartz, Co-Heads, Paper & Packaging, from Lincoln International provided an overview of the packaging industry including various subsectors (Flexible, Rigid, Paperboard, Labels).  Highlights included market insights, recent M&A activity, key valuation metrics and sector trends.

Please contact Chris Veber at 312-980-7856 or cveber@equityrisk.com for more information. 

Insurance Coverage is Staying Ahead of Private Equity Electronic Information Exposures Article

The operations of a private equity firm, and the electronic information exposures that stem from it, are unique and evolving. The most notable exposure that has underwriter's attention is the advancement and widespread use of inexpensive data site technology.

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Jefferies Professional Discussed the State of the Healthcare M&A and Capital Markets Executive Advisory Series

On Tuesday, December 10th, Michael Dodds, Senior Vice President, Healthcare Investment Banking, Jefferies discussed the State of the Healthcare M&A and Capital Markets.

For more information on this past event contact Chris Veber at cveber@equityrisk.com or 312-980-7856.

The State of the Insurance Market - 2013 "The Corleone Edition" Partners' Perspective

No matter how hard I try to get out of writing the State of the Market Letter, our clients, prospects and partners keep pulling me back in!  

Around this time every year, we give you one chance to ask us about our business affairs.  One.  So here it is.  Let’s hope that this State of the Market letter is more like The Godfather (no. 2 movie of all time) or The Godfather: Part II (no. 3 all time), and not The Godfather: Part III (a waste of time.)

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Robert W. Baird Professionals Discussed the State of the M&A / IPO markets & Consumer Growth Segment Executive Advisory Series

On Tuesday, November 12th, 2013, professionals from Robert W. Baird’s team of experts discussed the state of the M&A and IPO markets and the key themes driving investment during an extraordinary time for investing in consumer growth assets.

Transaction activity today in the retail and restaurant space has been meaningfully influenced by the economic downturn. In recent years, investors in the private and public markets have aggressively focused their attention on well positioned, multi-unit businesses.

The panelists were:

  • Chris Sciortino - Managing Director, Consumer Investment Banking (Robert W. Baird & Co.)
  • Maria Watts – Vice President, Consumer Investment Banking (Robert W. Baird & Co.)

For more information contact Chris Veber at cveber@equityrisk.com or 312-980-7856.

Harris Williams & Co. Professionals Provided a Market Update of Middle Market M&A Activity and the Environmental Services Sector Executive Advisory Series

On Tuesday, October 8, 2013, Hiter Harris and Patrick Hanraty from Harris Williams and Co. provided a market overview of Middle Market M&A in general and Environmental Services specifically.

For more information contact Chris Veber at cveber@equityrisk.com or 312-980-7856.

Volume 21 Partners' Perspective

2012 Equity Risk Partners Year in Review: See! We Told You So!  

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Volume 20 Partners' Perspective

2012 Equity Risk Partners Year in Review: "Occupy Wall Street Edition"

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Volume 19 Partners' Perspective

2011 Equity Risk Partners Year in Review

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The State of the Insurance Market Executive Advisory Series

May 12, 2009

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Volume 18 Partners' Perspective

The State of the Insurance Market  2010 - The Social Media Edition

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Volume 17 Partners' Perspective

The State of the Insurance Market - 2009 "Insurance Idol"

We are pleased to provide you with this overview of the current state of the insurance marketplace and its impact on private equity transactions and portfolio company insurance programs. Like the television phenomenon, American Idol, the current state of the insurance industry has three distinct "performers" all "singing" to their own "tune."

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Volume 16 Partners' Perspective

American Recovery and Reinvestment Act - COBRA Implications

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Volume 15 Partners' Perspective

Private equity firms are always looking for ways to take advantage of cost sharing among their portfolio companies - whether it is buying raw materials, telephone rate plans, or insurance.

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Volume 14 Partners' Perspective

The State of the Market - Conference Call Transcript

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Volume 13 Partners' Perspective

"Admitted vs. Non-Admitted Insurers - A Primer"

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Volume 12 Partners' Perspective

An update on the current situation with AIG, its potential impact, and our response.

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Volume 10 Partners' Perspective

Add-on acquisitions are a common way for our portfolio company clients to meet their growth objectives. Natural synergies must exist between the Parent (or "buyer") and the Target (or "subsidiary") in order for the acquisition to be successful. However, careful consideration must be taken in the due diligence process in order to ensure that the same synergies exist between the respective insurance programs.

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Volume 8 Partners' Perspective

In order to perform a thorough review of a target company's property/casualty and health/welfare insurance programs, knowing what to look for is as important as steering clear of the most common due diligence pitfalls. Here are some of the most common insurance/benefits due diligence mistakes that we see.

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Volume 7 Partners' Perspective

Deal Documents and Insurance Diligence

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Volume 6 Partners' Perspective

This issue of The Partners' Perspective addresses the myths and realities associated with so-called portfolio insurance programs.

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Volume 5 Partners' Perspective

Political Risk Insurance: A Unique Tool for Managing Lines of Credit

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Volume 4 Partners' Perspective

An executive liability policy is purchased for one purpose - to respond when you need it. So what do you do when you receive a claim?

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Volume 3 Partners' Perspective

Will liability coverage for past occurrences exist after a merger or asset purchase?

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Volume 2 Partners' Perspective

This Partners' Perspective will focus on the recent press reports regarding former WorldCom directors paying millions of dollars out of their own pockets as part of the pending securities fraud related class-action lawsuits. What motivated the outside directors to pony up personal assets? What liability precedent has been set? What impact might this have on your Directors & Officers/General Partnership Liability insurance? 

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Volume 1 Partners' Perspective

For the first Partners' Perspective, we will focus on the current hard insurance market and the "Lessons Learned from Underwriting Cycles."

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