Transactional Risk Insurance in M&A


how do you see the future of the R and W insurance market yes please go Emily no I was just gonna say I mean I think this is an interesting question and we did touch on that earlier when we talked about how the market is evolving very quickly I think there's going to continue to be pressure on speed of underwriting and a greater move to this thing almost a straight indemnity product rather than just a transfer of risk I think pricing is going to continue to be pressured but as claims increase I think that's going to even out and I think we're going to see greater and greater use from strategic buyers and that they have a slightly different outlook you know private equity is is looking for coverage for everything strategic buyers tend to be more cherry picky about the things that concern them and so what I'm seeing on strategic buyers is more sort of coverage for special indemnities rather than some of the blanket coverages that that private equity want but I think you know I've been doing this for twenty years I started in London where this this product has been around for a lot longer and it's gone through a lot of cycles of up and down I think we are actually getting to a space where the tipping point happens on this market and that this product is now here to stay as long as we can ride out the sort of bumps of a growing and evolving market yeah I agree with that this is our Michael McGowan again I agree with that I think the you know there will be some some additional pressure on pricing retention levels you know there are still a couple of you have markets trying to get into this space you know I don't think I don't foresee many more trying to get at this point but there you know there are still more they're trying to gear up whether it's you know a market coming from internationally that is want the US presence or you know I new mga or so on and so forth there there are a few more markets that are that are probably going to come in I think that there will be you know some shakeout as you know claims kind of come and you know obviously you know the reinsurance industry is is you know involved heavily in this as well so you know there will be you know some degree of you know compression there with how how things are being structured but I think what you're going to see you know especially in the next year or so is you know more of a stabilization something that's gone from you know definitely a growth industry of the last you know a few years to you know a more stable mature industry you'll definitely see you know maybe a little more standardization on products and you might see different types of products also being developed splitting off and I think you're also going to see an increased use from strategics definitely you know we've already seen that at XL and I'm sure that that that others have have seen this too and I think that education buyers are getting more comfortable with it as their you know their internal risk team or their internal corporate development team is understanding and of how to utilize the product I think you're gonna see much more of that I think that's where there's really the biggest growth area so I I do think that there's going to continue to be an uptick of policies across the board I don't really see that slowing down you know very soon but you know again it's becoming a more mature market versus a certain growth market the only drunk over the only other thing I would add there – is that an additional reward the insurance there has been a large uptick or an uptick in attacks liability insurance contingent risk policies sort of alternative insurance products that cover a risk that a buyer may they may be known or may be unknown but the rep mortgage insurance product either is not designed for it or it's too much of a risk that it can't be covered so that that has also evolved as well I think is transactional risk as a whole that will continue to grow as a separated standalone market itself you

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