Writers of professional liability insurance for hedge funds face new vetting challenges in the wake of both the Amaranth scandal and failed regulation efforts, warned one industry attorney.
But with a market penetration estimated at less that 20 percent, such writers still say the main challenge they face is persuading their clients they need the coverage.
Richard Bortnick, a partner at the New York-based firm of Cozen O'Connor, said a spate of shareholder suits has already arisen in the aftermath of the estimated $6 billion loss by Amaranth Advisors LLC.
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