Assets Under Management (AUM) (Management Liability)

Assets Under Management is the total value of client or fund assets that an investment manager controls at their discretion. AUM is a key underwriting measure because it links to risk. Larger portfolios usually mean bigger potential claims and a wider pool of investors who could bring a claim. Insurers use AUM to judge risk, set premiums, and decide on suitable cover limits. A policy may require the insured to disclose AUM at the start and at renewal, and to report any major change during the policy period. A large rise in AUM may trigger extra premium or require changes to the policy to keep cover adequate. For Australian fund managers, AUM moves up and down with market swings and investor activity, which changes their exposure over time. Some policies handle this with 'peak AUM' calculations or averaging methods. Because AUM links closely to potential claim size, accurate disclosure is vital. It ensures cover limits match the manager's real exposure.

Assets Under Management is the total value of client or fund assets that an investment manager controls at their discretion. AUM is a key underwriting measure because it links to risk. Larger portfolios usually mean bigger potential claims and a wider pool of investors who could bring a claim. Insurers use AUM to judge risk, set premiums, and decide on suitable cover limits. A policy may require the insured to disclose AUM at the start and at renewal, and to report any major change during the policy period. A large rise in AUM may trigger extra premium or require changes to the policy to keep cover adequate. For Australian fund managers, AUM moves up and down with market swings and investor activity, which changes their exposure over time. Some policies handle this with 'peak AUM' calculations or averaging methods. Because AUM links closely to potential claim size, accurate disclosure is vital. It ensures cover limits match the manager's real exposure.