Protect your Merger and Acquisition deals with W&I Insurance, (also known as transaction liability) covering risks from breaches of warranties or indemnities in sale agreements.
What is W&I Insurance?
- Seller W&I: Shields sellers from claims for breaches (e.g., tax or financial issues), covering liabilities and defence costs.
- Buyer W&I: Protects buyers with direct recovery for losses from breaches, bypassing seller litigation.
Explanation: Warranties cover historical business operations (e.g., employee payments, financial accuracy). Indemnities address specific risks like pre-sale taxes.
Benefits to your business with W&I Insurance?
- Maximises Deal Value: Reduces escrow needs, freeing capital for sellers; protects buyer investment.
- Minimizes Disputes: Buyers recover directly from insurers, avoiding seller conflicts.
- Long-Term Protection: Up to 7-year coverage, with 49% (North America) and 64% (EMEA) of claims post-12 months (2025 Study).
- Market Advantage: Competitive premiums and broad coverage streamline M&A deals.
Key Policy Features
- Seller W&I: Covers losses, defence costs; 7-year term; retention applies; excludes asbestos, sanctions.
- Buyer W&I: First-party coverage; 7-year term; retention above sale agreement; includes buyer’s parent/target group.
Explanation: Policies align with sale agreements, covering tax/general indemnities. Subrogation allows insurer recovery from third parties.
Subject to variations in insurers wording, exclusions and case specific endorsements.
