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Transactional Risk Products

Representations and Warranty Insurance

Representations and Warranties Insurance (RWI) is available to both buyers and sellers in a transaction and protects each party’s financial interests in the deal, and can elevate a buyers bid in a competitive auction process.

While the buyer relies upon the representations and related disclosures made by a seller in an acquisition agreement, a RWI Policy can transfer the risk to an insurer of an unknown and unforeseen misrepresentation of the M&A agreement, and can either enhance or replace the indemnification given by the seller.

RWI Policies can accelerate deal negotiations, preserve relationships between parties, provide recourse for a buyer, and allow a seller to walk away cleanly from a deal.

Our experienced Transactional Insurance specialists will walk our private equity and corporate clients through the quote and due diligence process and ensure the RWI policy is tailored unique to your transaction, accessing quality capacity in the market rated A or better by AM Best.

 

Tax Liability Insurance

Tax laws can be complex and ambiguous and as such Tax Liability Insurance is an insurance product that shifts the responsibility for tax contingencies from insured to insurer and protects against the financial uncertainty of a tax authority challenging an identified and supported tax position. These types of challenges can result in significant liabilities years after the original tax filing.

The policy can limit the uncertainty and risk of tax positions emanating from an M&A transaction or an internal tax situation and will be crafted specific to the situation to include coverage for the tax owed, interest, fines or penalties, and the costs to defend the position, among other coverages, subject to underwriting.

From an M&A perspective a Tax Liability Policy can protect both buyer and seller where a transaction fails to qualify for its intended tax treatment, remove difficult tax issues from deal negotiations, improve a bid in the auction process, or allow release of funds from escrow. Our relationships with leading Tax Liability Insurers will ensure we craft the right solution for the transaction.

Contact our team to learn more about Tax Liability Insurance and how it can be used to mitigate risk.

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