The impacts of the pandemic resulting from the coronavirus disease (COVID-19) have created unprecedented uncertainty and turbulence across the globe. Our highest priority – as a society, an industry, a company, and individuals – should be doing our part to stop the virus’s spread. But within the context of our work as Transactional Liability Insurance brokers at CAC Specialty, we will also continue to secure and execute the best possible risk-transfer solutions for our clients.

In this regard, the coronavirus is already a factor in the underwriting of representation & warranty insurance (“RWI”) and other M&A-related policies, and it’s important to understand the pandemic’s implications. Although we don’t yet know the end or even the middle of this story, we are writing now with some initial thoughts and observations, particularly with respect to the R&W insurance market.

  • Insurers are already seeking to exclude losses arising from the coronavirus pandemic in R&W policies that are not yet bound
  • COVID-19 and similar pandemics are likely to become an important part of R&W insurers’ underwriting
  • Some transaction timelines will be impacted
  • Competition for fewer deals could benefit insured in the short term
  • The pandemic may reveal other covered losses under existing R&W policies

As M&A activity continues, we are happy to discuss these issues and work with you to secure leading R&W insurance coverage.

Download a full copy of the COVID-19 Transactional Liability Insurance Alert.