As hedge fund managers anticipate potential fallout from regulatory enforcement actions, it is critical to have a sophisticated understanding of the mechanics of directors and officers (D&O) and errors and omissions (E&O) insurance, as well as the types of liability covered by those policies. These issues were the subject of a recent webinar hosted by Seward & Kissel. During the discussion, Mark Hyland, a partner at Seward & Kissel, and Jason Duffy, a partner and founder of Fieldstone Insurance Group, explained how insurance can be used to anticipate and mitigate the adverse financial impact of covered acts or omissions. This article analyzes the key points from the webinar. For a comprehensive overview of D&O and E&O insurance, see “Hedge Fund D&O Insurance: Purpose, Structure, Pricing, Covered Claims and Allocation of Premiums Among Funds and Management Entities” (Nov. 17, 2011). For additional insight from Seward & Kissel, see “Reduced Management Fees and Narrower Liquidity Among Trends in New Hedge Funds” (Mar. 31, 2016); and our two-part coverage of the Seward & Kissel private funds forum: “Trends in Hedge Fund Seeding Arrangements and Fee Structures” (Jul. 23, 2015); and “Key Trends in Fund Structures” (Jul. 30, 2015).