Heightened insurer appetite in the M&A market

Hilary Weiss : Underwriting Manager

Hilary Weiss

Underwriting Manager

The mergers & acquisitions insurance market has experienced significant growth over the past few years with more insurance carrier entrants serving a broadening array of industry sectors. Buyers and sellers can benefit from transactional insurance by seeking coverage from expert underwriting teams and professionals equipped with the knowledge and resources to deliver thoughtful, bespoke insurance solutions.

The range of industry sectors served by insurance companies to provide R&W cover has expanded, particularly within heavily regulated industries, such as healthcare, life-sciences and financial services. Previously, sectors considered to be specialty industries had access to only a limited number of carriers with the appetite to underwrite such risks. Many of these industries have now become mainstream targets for M&A insurance coverage. Given the upsurge in the number of RWI entrants in the market and competition to secure deals, there are few industry verticals where an insurer is unwilling to structure programs for transactional risk.

Underwriting complex deals is a niche market that relies on the skills and insight of disciplined teams of underwriters and outside counsel familiar with structuring comprehensive coverage. Sophisticated buyers and sellers are increasingly recognizing the upside of insurance capital to remove some of the historic roadblocks in bringing a deal to fruition. While recent efforts have been made by some carriers to deploy technology to improve underwriting efficiencies, such rules-based solutions cannot adequately uncover known and unknown risks or provide the level of service for multi-faceted, high profile transactions.

Liberty’s global M&A group is well positioned to underwrite complicated transactions with significant liability limits and cross-border elements. Our team of professionals structures coverage designed to protect buyers and sellers from the unknowns that arise throughout the deal process. As one of the only carriers in the market with a dedicated claims team, we understand looking after our insured post-deal is equally as important as our execution of the policy.

As the RWI market continues to evolve, carriers are looking towards creative solutions to enhance coverage. Such offerings, however, will need to be sustainable with rate pricing and claims management systems aligned in accordance with the level of risk. Insurers and brokers will be challenged to innovate together to ensure that coverage meets the expectations of the insured while maintaining the sanctity of the market.

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