The popularity growth of transaction liability insurance keeps rising, in the general M&A practice as well as for real estate transactions. The product covers the seller's liability for breaches of warranties given by the seller to the buyer and for claims under the tax indemnity. In Europe, this type of insurance tends to be referred to simply as W&I insurance, for Warranty & Indemnity.

An article on this subject, written by M&A partner Lennart Crain, gives a practical introduction and describes current market practice. In this article, he also reveals the mostly English-language jargon used by W&I insurance brokers.

Crain first sets out the most common functions of W&I insurances, before going on to address recent developments. This is followed by a discussion of points of interest of the policy and by the process of taking out a W&I insurance in general, and the integration of the W&I process within a controlled auction in particular. Lennart concludes by raising some comments on the W&I playing field and the market structure. The article has been published in a legal journal.

If you have any questions about 'How to bridge the gap' after reading the article, please contact Lennart. 

You can read the article here.