An Increasingly Popular Tool in M&A Transactions: Warranty & Indemnity Insurance to Optimize Risk Allocation

An Increasingly Popular Tool in M&A Transactions: Warranty & Indemnity Insurance to Optimize Risk Allocation

In an M&A deal, transactional risk allocation is always a major concern for both sellers and buyers. While sellers seek a clean exit for the post-deal period, buyers want to ensure they can turn to a reliable party with good financial standing should damages arise from breach of warranties. That is when warranty and indemnity insurance (“W&I insurance”) comes to the rescue. Despite its benefits, in the absence of specific legislation or established practice in Turkey, this new product is still waiting to gain popularity to a wider range of Turkish insurance companies and M&A market players.

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First published on Global Legal Post