Helping our global clients manage the risks inherent in mergers & acquisitions (M&A) transactions to protect the value of their investments and to facilitate the deal process.
Our experienced global team of specialist underwriters can tailor risk protection solutions for the business in each transaction through our suite of Transactional Risk Insurance products including Warranty & Indemnity (W&I), Tax Liability and Contingent Risk.
Risk Scenario
Who’s it for:
Typically, it is the buyer in the M&A transaction who is the insured party, but our products are designed to meet the needs of both buyers and sellers and to support the M&A activity of all dealmakers, including:
Private equity sponsors
Venture capital funds
Strategic and major corporate investors
Other business owners
What is covers
As our core product, Warranty & Indemnity insurance provides protection against financial losses, including costs associated with defending claims, for certain unintentional and unknown breaches of the seller’s warranties – i.e. when certain contractual statements made by the seller in the acquisition or merger agreement about the business being sold turn out to be false or untrue.
Tax Liability and Contingent Risk policies respond to financial loss associated with known risks (whether potential tax liabilities or other) within a business that have, typically, been uncovered during the buyer’s due diligence exercise.
Risk Protection and more
W&I insurance brings a number of strategic advantages in addition to the core financial loss risk transfer:
Clean exit for the seller
Can extend or enhance the warranty duration and/or liability cap
Deal process and/or negotiation facilitation
Bid differentiation for a potential buyer in a competitive auction
Relationship protection where the buyer and seller continue to work together after the deal is done (so buyer can claim against the policy instead of pursuing the seller)
Reputation protection by avoiding litigation (which may be public).
Related products
Related products
Global Transactional Risk - North America
Read more about our Global Transactional Risk products and services.
We’re leading experts in financial lines insurance – and we care about your company
Whether your business is big or small, takes you around the world or just around town, Chubb is there for you. Our breadth of experience in financial lines insurance means we can provide the guidance and service you need, whenever you need it, wherever you may be.
Partnership that’s personal We work to understand your business and where you’re heading so we can be proactive about meeting your needs. We invest in getting to know you, your team and your customers. The goal: to help you see ahead, be ahead and stay ahead.
Creative problem-solving Insurance isn’t one-size-fits-all – and neither is our approach. Our playbook is always evolving because we’re always helping clients avoid risk in smarter ways. That means we bring the latest thinking and a fresh perspective to solving your challenges.
Unmatched expertise and financial strength We’ve served clients and partnered with leading organisations for more than 200 years. Our longevity, expertise and financial strength are the bedrock of our business.
No, our Global Transactional Risk practice and worldwide capabilities (operations in 54 countries and insurance licencing far beyond) can service the transactional risk insurance needs of our global clients operating in an inherently cross-border M&A landscape.
No, our products can be adapted to protect either the buyer or the seller. That said, for a number of reasons (including a more direct first-party claims process and likelihood of broader cover), it is most typical for the buyer to be the named insured on the policy (and the seller will still benefit indirectly as the policy provides the buyer with an alternative avenue to recoup any financial loss).
No, our underwriting can commence at any time during the deal process. We typically need at least 10 business days to complete our process to be ready to bind cover, but we are very used to moving quicker to meet the deal timetable. You can even bind cover after the deal closes. That said, we would always recommend engaging the W&I insurance process as early as possible to give our underwriters the best opportunity to provide the broadest possible cover and the best available terms for the transaction at hand.
Yes, Transactional Risk / Transactional Liability and M&A insurance are interchangeable terms for the business line that encompasses insurance solutions for M&A transactions.
“Reps and Warranties” or “R&W” is the name given in the US to the Warranty & Indemnity (W&I) product – our global team can facilitate an R&W policy in North America.
