Merger & Acquisition Insurance Specialists

Are you about to merge with or acquire a business? 

Warranty and Indemnity Insurance, also known as Merger and Acquisition Insurance or Transactional Risk Insurance, is a policy that can enhance a deal, as well securitise risk of a merger and acquisition transaction. Warranty and Indemnity Insurance can protect either the buyer (buy-side policy) or a seller (sell-side policy) from financial loss that may arise in the event that there is a breach of the warranties and/ or indemnities given by the seller in the sale and purchase agreement (SPA) for the transaction. This can include potential tax liabilities.  

Benefits of Warranty & Indemnity insurance (Merger and Acquisition Insurance), are:  

  • Avoids potential litigation, to recover financial restitution for a breach of the warranties & indemnities.  
  • Bid enhancement, as the policy can negate the need for funds to be placed in escrow (or other form of security), to cover the contractual Warranties & Indemnities. This means that sellers can have immediate access to all sale funds.  
  • Can help facilitate improved finance terms.  
  • Provides comfort for seller, if the buyer requires a high level ‘maximum liability cap’ in the SPA; particularly if tax forms part of the Warranties & Indemnities.  
  • Clean exit and preserves relationships.  
  • Potentially removes deal-breaking risks from a transaction for both the buyer and the seller, by introducing an insurer, to bear some of those risks.  

    For a confidential discussion regarding your Merger or Acquisition please fill in the form below:

    Gareth Jones
    Managing Director
    4Sight Risk Partners
    0499 988 980 
    +61 499 988 980 if calling outside of Australia 
    Adviser Representative No: 1251287 

    Our clients have greater business
    protection and confidence.

    We achieve this via 4Sight Risk Partners ‘IQ-ARTA’ Business Risk framework,
    which is supported by 75 years of global risk expertise:

    Identify & Quantify (IQ)

    Analysis of business, strategic plans and partners, industry and wider economic influences to identify all risks and financially quantify their impact, a critical first step which forms the foundation of the business risk landscape.

    Avoiding (A)

    Identifying business process improvements that reduce the chance of impacting events.

    Reducing (R)

    Identifying threats and their consequences by introducing processes to mitigate them. 

    Transferring (T)

    Developing transfer strategies, such as insurance or contractual transfer to other parties.

    Accepting (A)

    Commercial evaluation that identified risk is financially manageable and/or highly unlikely to occur.