MANAGEMENT LIABILITY

General Partnership Liability Insurance

Monarch E&S is proud to offer executive, professional and cyber liability coverage through our sister company, CSRisks. CSRisks is a leading executive, professional and cyber liability wholesale insurance brokerage. Their knowledgeable experts provide analytical capabilities, a consultative approach and expert insurance broking services. With access to over 30 A rated insurance carriers, both admitted and non-admitted, their specialization means they quickly provide the cost-effective coverage and analysis retail agents rely on.

What Is General Partnership (GP) and Limited Liability Company (LLC)?

A General Partnership is business structure where two or more people/entities share ownership and management responsibilities with each other sharing personal liabilities for the business’s debts conversely a Limited Liability Company (LLC) is a business structure where owners (called members) have limited liability, meaning their personal assets are protected from business debts; essentially, an LLC provides greater legal separation between the business and its owners compared to a general partnership.

Why do GP’s need tailored coverage rather than a typical For-Profit D&O policy?

General Partnership Coverage is specifically designed to cover controlled entities where the GP may have no ownership interest, some ownership interest or wholly owned interests.

Usually there is one key partner or member manager whose interests are primary over the actual General Partner Entity. All entities must roll up to the listed GP/Member Manager or be scheduled to the policy. If the organization fractures, there could be gaps if not tailored.

Pitfalls of GP Coverage

Members of an LLC/LLP which is run by the GP (Named Insured) can only be covered if the entity is covered- multiple GPs means naming all GPs/Member Manager Organizations
If missed, then all entities under that GP/Member Manager are not covered

Why Do Non-profits Need D&O Insurance?

Leaders in these organizations may not be dealing with the pressures of profit-driven businesses, but they still face legal responsibilities and the potential for lawsuits. The protection offered by D&O insurance ensures that these organizations can attract and retain qualified individuals, who might otherwise be reluctant to serve due to the potential personal financial risks.

(D&O) Liability Insurance with CSRisks

Complete Submission requirements:

D&O or Equity Package Application
Organization Chart showing ownership of all entities –and who is GP/Member Manager for every entity whether owned or controlled
Current Financials for each entity or consolidated financials for GP’s activities
Current Articles of Organization
Operating Agreement (generally the template one which is the basis for all agreements)

Policy Highlights

Definition of Insured – Subsidiary is not accurate with LPs and LLCs (they are sister companies or mirrored structures)
Definition of Wrongful Acts –does not include managerial acts on behalf of other companies thus a standard E & O will exclude many claims
If giving coverage for General Partnership then you must list every LLC, LP, LLP and notify of any new ones as soon as possible because there is usually no coverage for new entities that are not owned by the parent
Controlled Language in the definition of Insured is not enough – there are still standard D & O exclusions to be modified

Talk to Our Experts

Amanda Sedliak, CIC, President, Capitol Special Risks

Alison Green, Director of Brokerage, Capitol Special Risks

Mike Morales, Senior Vice President, Specialty Wholesale Insurance Solutions