News & Analysis as of

Representations and Warranties Insurance Claims

Woodruff Sawyer

Reps & Warranties Insurance: Our 2024 Guide

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The use of representations and warranties insurance (RWI or R&W) has become increasingly mainstream. An estimated 75% of private equity transactions and 64% of larger strategic acquirers use it. Woodruff Sawyer’s R&W team...more

StoneTurn

Expert Series Q&A: Joe Corsello, Euclid Transactional

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Joe Corsello, Associate General Counsel & Managing Director, Claims for Euclid Transactional, shares his insights on pivoting from litigation to reps and warranties insurance, opportunities for those seeking a career in the...more

Lowenstein Sandler LLP

What RWI Buyers Should be Prepared for as Deal Flow Resumes

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In this episode of “Don’t Take No for an Answer,” host Eric Jesse is joined by Jeff Rubocki, senior managing director of the Private Equity practice at Risk Strategies, to predict what the rest of 2024 may hold from a reps...more

Lowenstein Sandler LLP

Myths and Misconceptions About Reps & Warranties Insurance

Despite the popularity of reps and warranties insurance (RWI), many common misconceptions about this insurance product still exist. For example, while it’s often believed that RWI is too expensive or unsuitable for a specific...more

Woodruff Sawyer

M&A Minute: When R&W Insurance Works to Cover Interim Breaches

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Reps and warranties insurance (RWI) ensures the policyholder is covered for breach of contract for mergers and acquisition (M&A) transactions. Failures in diligence or fraud on the part of the seller can result in breaches of...more

Lowenstein Sandler LLP

Do R&W Insurers Still Pay Claims? Following Up on Lowenstein’s 2020 Survey

In 2020, Lowenstein Sandler released a groundbreaking report, authored by Lynda A. Bennett and Eric Jesse of Lowenstein’s Insurance Recovery Group, based on results of a survey that sought to answer a key question about reps...more

Goodwin

Reps & Warranties Claim Disputes in the Courts

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- Representations and Warranties Insurance (RWI) policies have been prominent over the last decade, but there are few court cases regarding coverage disputes. But this type of litigation appears to be on the rise in the court...more

Woodruff Sawyer

Reps & Warranties Insurance Volatility: What You Need to Know

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We saw a lot of upheaval in the reps and warranties insurance (RWI) market in the last quarter of 2021. Pricing went up across the board, and many deals got considerably fewer quotes than earlier in 2021. Let’s look at why...more

Lowenstein Sandler LLP

Reps & Warranties Insurance Claims: Getting to “Yes”

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Continuing the discussion about representations and warranties insurance (RWI) from last week’s episode, Lynda, joined by Eric Jesse, Partner in Lowenstein’s Insurance Recovery Group, and Emily Maier, Senior Vice President...more

JAMS

The Importance of Adding a Mediation Provision to Representations and Warranties Policies

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I recently mediated a dispute involving a claims-made policy with a condition precedent to either side commencing litigation: mediation. Specifically, the policy stated the following: The Insurer and the Insured agree that...more

Faegre Drinker Biddle & Reath LLP

Reps and Warranties Insurance: Claims Continue to Increase

Hundreds of practitioners joined together — virtually — in the past month to attend two conferences concerning representations and warranties insurance (RWI), a product aimed at transferring the risk associated with M&A...more

Lowenstein Sandler LLP

How To Pursue Reps And Warranties Claims

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The past decade’s robust mergers and acquisitions volume sparked the rapid growth of representations and warranties (R&W) insurance. This coverage provides protection from losses due to a seller’s breach of representations in...more

Lowenstein Sandler LLP

Maximizing R&W Insurance Claims

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Representation and warranty insurance has changed the M&A market. The popularity of reps and warranties (R&W) insurance—which provides indemnity to buyers for breaches stemming from seller misrepresentations in acquisition...more

Carlton Fields

Damages for Reps and Warranties Breaches

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When one party to an M&A agreement alleges that the other breached its representations and warranties, the damages analysis can be complex, depending on the terms of the agreement. Generally, a claim for indemnification due...more

Carlton Fields

The Perils of Using Baseball Arbitration to Resolve RWI Policy Disputes

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In the world of M&A and private equity deals, buyer-side representation and warranties insurance (RWI) transfers the risk of a seller’s representation to an insurer. To adequately safeguard the insurer, it therefore becomes...more

Carlton Fields

The Impact of the Duty to Mitigate on Diminution of Value Claims

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Buyers in M&A deals often contend that they value a target company based on the seller’s representations and warranties. If the buyer later determines those representations and warranties were false, it may argue that, as a...more

Carlton Fields

Value Claim: Non-Recurring Impact of Unknown Business or Operational Issue

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RWI valuation claims often arise from a breach of financial statement representation and warranties where the buyer asserts that the transaction was over-valued because prior earnings, on which the purchase price was based,...more

Carlton Fields

Breach vs. Loss

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Does a seller’s breach of representations and warranties in a merger and acquisition (M&A) transaction automatically entitle the buyer to compensation?...more

Carlton Fields

RWI Claims That Keep You Up at Night

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No One Likes a Bad Deal- Sometimes an acquired company’s revenues and earnings decline substantially following an acquisition. The investment is worth less to the new owner and the reputations of the deal team that...more

Carlton Fields

Under the Microscope: Dissecting Errors to Evaluate RWI Damage Claims

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After an M&A transaction, a buyer may discover certain misrepresentations as to the target company’s historical reserves. These misrepresentations often result in a RWI claim by the acquiring company. In these cases, it is...more

Carlton Fields

The Building Blocks of Materiality

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Representations and warranties play an important role in M&A agreements by providing valuable disclosures and allocating risks between the parties. Representations regarding the target company’s financial statements are...more

Carlton Fields

When Balance Sheet Errors Turn into Multiple EBITDA Claims

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After an M&A deal closes, the purchaser may discover information that it considers erroneous in the balance sheet accounts in the acquired company’s financial statements....more

Carlton Fields

Valuing Income Statement Breaches in Transactional Insurance Claims

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Once it has been determined that a breach of a financial statement representation in an acquisition agreement has occurred—specifically with respect to an identified income statement—the question arises as to the quantum of...more

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