Tag archives: insurance

Transforming Adversity into Opportunity: The Need for New Technologies Fuels Insurance M&A

The COVID-19 pandemic has changed the way in which we interact with the world. From working, to shopping, to socializing, most aspects of our daily lives have moved to the online world. Consumers now expect effective online platforms for all goods and services, and businesses have been forced to adapt quickly.

The need for robust online technologies drove a number of large M&A transactions for enterprise technologies in 2020. While insurance companies have struggled throughout the pandemic, with share prices collapsing due to a rise in insolvencies, new technologies have the potential to transform the industry, driving a flurry of … Continue Reading

Key findings: 2018 SRS Acquiom Buy-Side Representations and Warranties Insurance (RWI) Deal Terms Study

SRS Acquiom recently published its first Buy-Side Representations and Warranties Insurance (RWI) Deal Terms Study. The study analyzed the terms of 588 private-target acquisitions that closed between 2015 and 2017, the majority of which are not required to be publicly disclosed. As Canadian M&A deals continue to use RWI at an increasing pace, insights from firms such as SRS Acquiom offer valuable perspective on popular terms in RWI covered deals. Some of the study’s key findings are outlined below.

Financial terms

  • Escrow. One of the most pronounced effects of RWI coverage is the reduction in the amount of
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Quebec opens its door to InsurTech: opportunities to grasp

The insurance industry is changing. A more digitally savvy customer base and the emergence of new technologies are reshaping the sector. Enter technology-led companies known as “InsurTechs.”

In Québec, this innovative business approach along with a substantial legislative change is expected to increase M&A transactions.

Mindful of offering a regulatory environment that is flexible and apt to respect the evolution of technologies and consumers’ needs, the province adopted Bill 141, An Act mainly to improve the regulation of the financial sector, the protection of deposits of money and the operation of financial institutions, on June 13, 2018. This … Continue Reading

A rundown of “run-off insurance”

Run-off insurance is a particular aspect of director and officer liability (D&O) insurance that can protect directors and officers of a target company following an M&A transaction.  In many cases, a target company’s directors and officers will resign from their roles following an acquisition. Run-off insurance (also known as closeout insurance or run-off cover) protects directors and officers from claims made against them after they have stepped down.

D&O insurance will protect acting directors and officers, but it does not necessarily cover former directors and officers.  Former directors and officers could be unprotected if they don’t have some … Continue Reading

Cyber security: what the hack?

In a previous blog post, we discussed how to manage cyber security risks during the negotiation and due diligence stages of an M&A transaction. In this post we discuss cyber security insurance as a tool for managing this unwelcome risk.

The cyber security risk

Although businesses have been ramping up their information security systems, the pace of cyber security breaches is not slowing down. One study estimates that cybercrime will cost businesses $2.1 trillion globally by 2019. And, as recent security breaches have taught us, a security breach can have reputational, moral, and deeply political complications. The 2014 hack … Continue Reading

Foreign investors eye Canadian companies

Canadian companies are becoming increasingly attractive to American and European companies as targets of foreign investment according to a recent article from the Lexpert Special Edition on Canada’s Leading Corporate Lawyers, published within the June edition of The Globe and Mail’s Report on Business Magazine. The Lexpert article states that both U.S. and U.K.-based investors in particular are increasingly turning their attention to Canada for M&A opportunities.

According to the Lexpert article, which surveyed leading Canada’s leading M&A corporate lawyers on the topic, American companies are the main source of cross-border deal activity, due in large part to … Continue Reading

Make it someone else’s problem: allocating risk in M&A transactions through insurance

During the course of an M&A transaction, it is often the case that the most hotly negotiated aspects of a purchase agreement are the representations and warranties and related indemnities. This is not surprising as these are the key devices used to address allocation of risk as between the parties, and by extension, price. While buyers want the security and protection of knowing they paid for what they thought they were buying (essentially minimizing surprises post-closing), sellers often desire a clean exit from the transaction. Parsing though these competing objectives can be time consuming, costly and may hinder a deal.… Continue Reading

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