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Transactional Liability Insurance

Representations and Warranties Coverage has taken on a life of its own in the last few years and is now seen as a key element for mergers and acquisitions. Originally preferred by private equity purchasers, transaction liability insurance has become increasingly popular with strategic buyers. Most M&A deals now use some form of insurance to protect against the financial impact of a breach in a representation or warranty in the Sale & Purchase Agreement. Industries that were previously considered uninsurable in this class, such as healthcare, are now able to purchase this insurance for their M&A deals.

Our firm has a unique offering in this business line bringing together the experience of our corporate teams, insurance policy drafters and a dedicated insurance department specializing in policy coverage, claims monitoring and defense of insureds. We are recognized for the strength of our offering in the fields of government contracts, healthcare, aviation and defense and telecommunications, and this has formed the background for developing model insurance wordings to suit our clients’ M&A needs. 

Our attorneys work with lead underwriters to assess the scope of coverage for novel loss scenarios, considering issues thrown up by seller fraud, grey market lending, environmental liability, tax, buyer claims against sellers, and the application of subrogation recoveries. 

Representative Engagements:

  • Representing the buyers and their insurers on environmental exposure.
  • Assessing coverage for buyer litigation against third parties to protect the value of its investment and mitigate loss.
  • Acting for directors and officers insurers on a dispute involving liability for tax on recently purchased assets, where transactional insurance was also implicated.
  • Assessing scope of cover for breaches of warranties by the seller of a medical clinic network.
  • Assessing coverage for seller fraud in hiding liabilities off-balance sheet and in the illicit removal of company technical knowledge.
  • Assessing coverage for alleged conflict of interest by the sellers in setting up a competing business.
  • Defending the buyers against breach of contract/negligence claims in a cyber tech setting.