Representations, Warranties & Transactional Products

Completion of a business transaction can be threatened by others – make sure to protect yourself.

Mergers and acquisitions, asset purchases, leveraged buy-outs, and other corporate transactions all come with risks and uncertainties. But they can be mitigated through the use of transactional insurance products tailored to address contingencies or disagreements that threaten or impede the completion of a business transaction.

The products below offer solutions to potential disagreements regarding the allocation of financial responsibility, the magnitude of the exposure, or simply the relative size of the exposure compared to the transaction size. Products available from the New York, Bermuda or London markets include:

• Representations and Warranties
  Protection for financial loss resulting in unintentional breaches in representations and warranties made by one party to another in a transaction. The policies can attach excess of – or replace – an escrow fund, and can be structured for either the buyer or seller as the insured party.
• Claim or Litigation Buyout
  Insurance for a specific lawsuit or other pending legal contingency for the purpose of mitigating potential barriers to a merger, acquisition or restructuring. There are various structural options for capping existing claim exposure. By eliminating the uncertainty surrounding potential assumed liabilities, the parties are able to fairly value and move forward with the transaction.
• Tax Opinion Guarantee
  Protection against financial exposure associated with the potential challenge to an identified tax position by a taxing authority.
• D&O Tail / Run-Off Coverage
  Due to the "claims-made" nature of D&O insurance, the wrongful act of a director or officer may not give rise to a claim up to five (5) years after the time of the wrongful act (Section 804 of the Sarbanes-Oxley Act of 2002). The purpose of the run-off policy is to protect directors and officers of a company for claims which may be brought against them well after the transaction has been consummated.