Into the Breach

Kicking off the new year with their first guest of 2024, Bryan and Gena welcome Megan Quail, Managing Director and Head of Reps and Warranties Insurance – North America, VALE Insurance Partners for a discussion of where RWI stands in the first few months of 2024 and what we can expect in the year to come. Topics discussed include: • How Megan transitioned from an initial career path in litigation to working in RWI • Megan's role in forming WoTR, Women of Transactional Risk, the highly successful industry group supporting women with careers in transactional risk • The current state of the RWI market including pricing, retention, and policy term updates • The impact of new carriers in the RWI space • Where Megan sees RWI headed for the remainder of 2024 • Megan's favorite Barenaked Ladies song

Returning from a summer hiatus, Bryan and Gena are joined by veteran broker Sandra Lee, Chief Executive Officer – Asia, BMS Group, for a discussion on the state of transactional risk insurance in Asia. Topics discussed include: • How Sandra transitioned from working as a M&A attorney to being one of the first transactional risk brokers in Asia • How BMS created a premier global platform for transactional risk with unique capabilities in Asia • The key similarities and differences between transactional risk policies in Asia and North America • Current pricing trends and deal activity in Asia • The growth in carriers underwriting in Asia • Geographic differentiation in underwriting transactions in Asia

Archer Transactional, a Balanced Partners Program, recently launched in the RWI space, with long-time transactional risk leader Ben Welch at the helm. In this episode, Bryan and Gena are joined by Ben for a discussion of Archer's birth and how this new carrier will seek to become the best RWI platform in the United States by marrying underwriting efficiency with strong claims handling experience. Topics discussed include: • How Ben's background in litigation and claims, and underwriting at other RWI carriers prepared him for his current role • How Archer obtained capacity and still launched despite the challenging M&A environment • Background on the team that Ben has assembled at Archer • The continuing strong demand contingent risk insurance • The importance of claims and Archer's approach to claims handling • How AI can factor into transactional risk insurance in the future • Ben's favorite moment as a newspaper journalist in his career before RWI

Combining a global underwriting platform with deep experience in the North America RWI space, RiskPoint has quickly established itself as a premier transactional risk carrier since launching in 2021. In this episode, Bryan and Gena are joined by Michael McGowan, Managing Director and Head of M&A Americas, for a discussion of where RiskPoint sees itself in the current market and plans for the future. Topics discussed include: • How the RiskPoint platform allowed Mike to marry his prior transactional risk experience with a new entrepreneurial vision • Why Riskpoint's global presence helps set it apart from other markets on cross-border transactions • How RiskPoint's comprehensive pre-underwriting process provides a better overall experience for the insured • RiskPoint's long term commitment to RWI in North America • Mike's global pick for where Into the Breach should do a remote taping

One of the industry's most prominent brokers, Matt Heinz, Partner & Co-Practice Leader, Transactional Liability, at Lockton Companies, joins Bryan and Gena for an enlightening discussion on the newest transactional risk trend: using RWI on secondaries transactions. Topics reviewed include: • What is meant by a GP-led “secondaries” transaction • Why secondary transactions are attractive risks for RWI insurers • How secondaries are different from traditional buyout deals • Pricing trends for secondaries relative to other types of deals utilizing RWI • Coverage potential for “excluded obligations” • Discussion of the 2023 Kentucky Derby and Matt's wardrobe at the big event

Palisade Insurance Partners is open for business, becoming the first transactional risk insurer with a primary focus on contingent risk. In this episode, Bryan and Gena are joined by John McNally, President at Palisade Insurance Partners, for a discussion of his new venture and how transactional risk insurance can be creatively utilized on contingent risk matters. Topics reviewed include: • How John's background as a long-time transaction insurance underwriter and broker led him to his current opportunity • The types of insurance solutions that Palisade will underwrite including claim and litigation portfolios, adverse cost insurance and judgment preservation insurance • The underwriting process and price considerations for each type of risk • How Palisade's insurance products can complement RWI in M&A deals and bankruptcy • Why transactional risk insurance is poised for strong growth on contingent risk matters

In a more philosophical episode, Bryan and Gena are joined by world renowned tax expert Harry Ballan, Managing Director, Global M&A Group, Alliant Insurance Services, for a wide-ranging discussion of how transactional risk insurance fits into the broader history of risk allocation between parties. Topics discussed include: • How Harry's background as a PhD recipient, university professor, and then his “second-career” as a long-time tax partner at Davis Polk collectively helped prepare him for his broker role at Alliant • How transactional risk insurance compares to other means to allocate risk throughout history • Why the transactional risk insurance marketplace illustrates the binary and non-binary nature of risk • The role that litigation insurance can play in risk management and decision-making • Discussion of one of Harry's favorite tax pupils who has a special connection to the podcast

Continuing our international theme, Bryan and Gena kick off ITB's 2023 season with Joshua Begner, Head of Private Equity and M&A Israel at WTW, for a primer on how transactional risk insurance can be utilized on deals in Israel. Topics discussed include: • How Josh developed the first RWI brokerage shop based in Israel with WTW • Why RWI is well positioned for Israel's “start-up nation” mentality • An explanation of the RWI policy structure in Israel and why the unique structure is the “best of both worlds” benefitting both insurers and insured • How RWI policies are currently priced in Israel • The foreign location where Josh thinks ITB should go “on the road” in a future international episode

While the dramatic growth in RWI in recent years was driven primarily by private equity, corporate buyers have implemented transactional risk insurance with increasing frequency in the last eighteen months. Yet, due diligence for corporate buyers can be different from PE purchasers and many corporate dealmakers are still in the dark about the RWI underwriting process. In this episode, Bryan and Gena are joined by Nick Tuliebitz, Co-Head of M&A Insurance North America at AssuredPartners, for the end all be all discussion about what corporate acquirers must know about RWI and how corporate buyers can have a successful RWI underwriting experience. Topics reviewed include: • Why a corporate buyers should “know before you go” and be strategic about RWI early on in the deal process • What type of due diligence RWI carriers expect • How corporate buyers can minimize policy exclusions • The importance of planning for specific due diligence workstreams -- notably tax and underlying insurance • Preparing for the RWI underwriting call -- “a call to arms” • Critical “dos and donts” for corporate buyers on the underwriting call • “Follow-ups and Wrap-ups” -- what the corporate buyer can expect post-underwriting call • Nick's favorite Thanksgiving tradition

With an emphasis on technology and efficiency, io.insure recently launched Mio, a new global RWI underwriting platform for SME deals. In this episode, Bryan and Gena are joined by David Rogers, the co-founder of io.insure, for a discussion about this innovative approach to underwriting RWI. Topics reviewed include: • How Mio uses technology to offer a streamlined RWI underwriting process for up to $100 million dollar deals • How Mio can still provide a more “traditional” underwriting process for insureds that prefer this approach • Using the platform for real estate deals through its Rio product • The reaction from insureds and brokers since the launch • What David would do if he won Powerball

Building on its incredible growth since its formation in early 2020, Dual Transaction Solutions is now launching a stand-alone tax insurance product. In this episode, Bryan and Gena are joined by Yash Jafari, Senior Vice-President Tax at Dual Transaction Solutions, for a discussion on Dual's latest transactional risk offering. Topics reviewed include: • The “three buckets” of tax risks that Dual finds attractive to underwrite in today's market • How the IRS's renewed focus on enforcement will impact the tax insurance product • The use of tax insurance for carbon credits under the Inflation Reduction Act • The tax underwriting approach that Dual will use -- combining a strong technical expertise with practicality, innovation, and creativity • Yash's personal favorite section of the Code

Continuing with our “career theme,” Bryan and Gena are joined by Heith Rodman, Vice-President and Transactional Risk Underwriter at Berkley Transactional, for a discussion on making the career jump from M&A counsel at an international law firm to transactional risk underwriter at Berkley. Topics discussed included: • Heith's background as a long-time M&A attorney at Jones Day in Atlanta • Why Heith made the transition from M&A attorney to transactional risk underwriter • The biggest differences between working as M&A counsel and underwriting RWI • The information deficiency that transactional risk underwriters face • The aspects of the RWI process that matter most to M&A attorneys • Heith's career advice for other M&A attorneys that are interested in joining the RWI industry • How many times Heith has visited the Coca-Cola museum

Founded by brothers Dave and Ken DeBerry, Concord Specialty Risk was the true pioneer in the RWI space and one of the original carriers offering the product. With Ken's recent retirement, Bryan and Gena are joined by his successor, Rustin Paul. Topics discussed included: • How Rustin intends to build on Concord's proud heritage to grow in a competitive RWI marketplace • The one critical question that Concord underwriters ask when deciding how to value a risk • Concord's pragmatic approach to underwriting, including areas of heightened concern in deals -- and areas of lesser concern as well • Why Concord is moving towards a 90 minute underwriting call • We put Rustin on the spot in a discussion around boxing

RWI coverage for healthcare deals has evolved -- years ago, healthcare transactions were generally difficult to insure; now, multiple RWI markets offer attractive coverage options and competitive rates. Still, healthcare deals have unique features that carry additional risk for insurers and can result in a more robust due diligence process before the policy is bound. In this episode, Bryan and Gena are joined by Jonathan Sprintz, Managing Director at Blue Chip Underwriting, to talk about utilizing RWI in healthcare transactions. Topics discussed include: • The historic use of RWI on healthcare deals • How the RWI marketplace has evolved to provide better coverage options  • Certain types of healthcare transactions and specific facets of deals where RWI coverage is still challenging • The scope of due diligence that carriers expect Buyers to provide to obtain RWI coverage, including with respect to specialized topics such as billing and coding •Current pricing and retentions on healthcare deals

2021 was a historical year for RWI. Carriers and brokers placed more RWI policies than ever before. Premiums rose, reflecting the available supply and demand for the product. Multiple new carriers jumped into the North American market. But after an incredible 2021, what lies ahead in 2022 is an open question. Can RWI continue its winning streak, or do more ominous days lie ahead? To answer this question and many more, Bryan and Gena are joined by Aartie Manansingh, Managing Director at Willis Towers Watson. Topics discussed included: • Recap of the 2021 year and analysis of the opening moments of 2022 • Whether premiums are likely to remain elevated in 2022 • The prospect of more insurance carriers entering the North American market • How existing insurance carriers are challenged by human capital deficiencies • The most likely “hot areas” for RWI in 2022

Continuing our trend of how RWI can be successfully utilized in cross-border transactions, to kick-off 2022, Bryan and Gena are joined by John Antonecchia and Sean Flinn of BFL Canada's M&A and Risk Management Practice, to discuss the current state of RWI in our neighbor to the north. Topics discussed included: • The development of the M&A practice at BFL Canada. • Latest update on premiums for Canadian policies. • Key similarities and differences between RWI policies in Canada and the United States. • The types of transactions that most frequently utilize RWI in Canada. • The number of insurance carriers currently offering RWI in Canada. • Why more US insurance markets should consider expanding into Canada.

Perhaps no innovation better exemplifies the entrepreneurial spirit of transactional risk insurance than the development and growth of tax insurance. This niche product allows the insured to protect against known tax risks in a variety of areas—S corp status, energy credits, REITS, permanent establishment, estate tax, and independent contractor misclassification, to name a few. What's more, tax insurance can be utilized in both the deal context as well as a stand-alone product for individual taxpayers. To better understand how to effectively use tax insurance and the current state of the tax insurance market, Bryan and Gena are joined by Michael Saitta, Tax Underwriting Counsel at Liberty Global Transaction Solutions, to discuss: • How tax insurance is similar to and different from traditional representations and warranties insurance. • The type of risks that tax insurance can—and cannot—protect against. • The present state of the tax insurance market. • The tax insurance underwriting process. • How tax insurance is priced and other key insurance policy elements such as policy limits and retentions.

Continuing our podcast series on career paths in RWI, Bryan and Gena are joined in this latest episode by Thomas Bonfiglio, Senior Vice President, Transactional Risk Practice, CAC Specialty, for an illuminating discussion on the pros and cons of working as a transactional risk insurance broker versus a transactional risk insurance underwriter. Tom draws on his long career as both an underwriter at Concord Specialty Risk and his prior broker position with Aon and now at CAC to provide valuable advice about the advantages and disadvantages of each field. Specific topics include: • How Tom's undergraduate training in risk management has informed his career in transactional risk insurance • How Tom has succeeded as both an underwriter and broker without a law degree • The challenges facing underwriters in today's red-hot deal environment • How brokers can play a critical role in bridging the divide between the insurer and the insured • The personality traits that he has found are most important for each position

Coming off an exceptionally strong first half of 2021, reps and warranties insurance seems hotter than ever, aided by the receding pandemic, more interest in the product from corporate buyers, and pent-up M&A capital from private equity firms. To re-cap what we have seen so far in 2021, and preview what lies ahead for the second half of the year, Bryan and Gena are joined by Julia Papastavridis, Managing Director and Member at Chief at Aon, with a special reps and warranties insurance mid-year update. Specific topics include: · How 2021 has compared to both 2020 and 2019 for RWI demand · The top reasons why the RWI market remains strong · The current state of the COVID-19 exclusion from carriers · How potential tax code changes may influence RWI in the months ahead · The latest trends on RWI premiums and retentions · The popularity of the product in 363 sales, SPACs, secondaries, and minority investments · An announcement about the Aon 2022 transactional risk symposium in Miami, Florida!

As corporate buyers turn to RWI as a deal solution, and insurance markets try to find creative ways to expand business in an increasingly competitive space, DUAL Transactional Risk has re-branded itself as DUAL Transaction Solutions and will begin offering excess D&O capacity in addition to its core RWI product. On this episode of the podcast, Bryan and Gena are joined by Dennis Kearns, President DUAL Transaction Solutions, to discuss the new D&O offering and DUAL's re-branding effort. Specific topics include: • Background on DUAL and the genesis of the new combined offering • The state of the current D&O market and the opportunity that DUAL sees • Synergies between the RWI product and D&O excess coverage, especially for corporate buyers of both products and the financial services marketplace • How DUAL has built the excess D&O capacity with experienced D&O leaders • The new structure of the DUAL Transaction Solutions team

The oft-repeated mantra is that representations and warranties insurance is not a replacement for a target company's underlying insurance policies, making such policies an important ancillary aspect of RWI coverage. But despite the key role that underlying insurance plays in the RWI process, insurance due diligence is not always well understood -- relegated to five minutes on the underwriting call and without the level of detail or sophistication that we customarily see in other specialists areas. To help underwriters better understand underlying insurance policies and the critical role that other underlying insurance plays in deals utilizing representations and warranties insurance, in this episode, Bryan and Gena are joined by Josh Warren, M&A Advisory Practice Leader, the ABD Team, to discuss: • How RWI underwriters can assess the risk associated with the target company's underlying insurance policies • An explanation of prior bad acts coverage and tail policies • In what circumstances underlying insurers will -- and will not -- waive change in control provisions • What is really meant to sit “excess of and no broader than” the underlying insurance and the pros and cons of using this approach to limit RWI risk • How other specialty insurance products -- successor liability, discontinued products -- can be used in tandem with RWI to achieve positive outcomes for insured and insurers alike • Guidelines on assessing coverage limits in common underlying insurance, such as cyber insurance

With the inter-connected nature of the global economy, M&A deals today frequently have international components. The transactional risk insurance markets have largely “split” by geography in terms of policy type, with “W&I” policies underwritten in Europe and Asia generally offering less robust coverage than “RWI” policies in North America. Some creative carriers have started to offer special “hybrid” policies to bridge the gulf in international deals and offer an integrated insurance solution that borrows from the best of both policy types with appropriate safeguards for insurers. In this episode, Bryan and Gena are joined by A.J. Kritzman, Senior Underwriter, Transactional Risk Insurance, Tokio Marine HCC, to discuss: • An overview of international transactional risk insurance • The key structural policy differences between “W&I” policies underwritten by carriers in Europe and Asia and “RWI” policies underwritten by North America carriers • The treatment of disclosures and scheduled items under each policy type • Current pricing trends for “W&I” and “RWI” • How Tokio Marine can design a hybrid policy borrowing elements of “W&I” and “RWI” for your next international transaction

March 2021 marks one-year since COVID-19 took over the United States, rattling the U.S. M&A markets, and grinding deals to a virtual standstill. The advent of the virus also profoundly impacted the reps and warranties insurance product, leading insurers in the spring of 2020 to impose special “COVID-19 exclusions” and requiring heightened due diligence around COVID-19 related risks. But by December 2020, the markets had shifted yet again, turning red-hot, and culminating in a rush of year-end deals and many U.S. transactional risk markets pulling back from blanket COVID-19 exclusions. With vaccines now here and re-openings on the horizon, where are M&A markets and RWI headed now, in hopefully the final stages of the COVID-19? To talk about these topics and more, Bryan and Gena are joined by Bill Monat, Executive Vice-President and Transactional Risk Solutions Leader at Willis Towers Watson. Known industry-wide as one of the preeminent thought leaders in the RWI space, Bryan, Gena, and Bill engage in a big-picture discussion on COVID-19 and its impact on reps and warranties insurance, touching on topics such as: • A revisiting of how 2020 started for M&A markets • A discussion on the immediate impact felt by COVID-19 starting in March 2020 • The advent of the “COVID-19” exclusion on RWI policies and how different markets initially reacted to the virus • The market rebound in Q4 of 2020 and how RWI placements finished for the year • The state of the market today in March 2021 and how insurers have evolved on COVID-19 policy language • Predictions about how the arrival of the vaccine and gradual reopening will impact M&A and RWI • Looking back at changes that we thought in 2020 were poised to occur and how the virus impacted their trajectory

Hardly anyone goes to law school or business school to work in transactional risk insurance. Yet, the growth of the RWI industry in the last ten years has led to an explosion of jobs in the field, usually filled by former M&A attorneys who land in the industry by accident. So, how exactly does one go about making a career shift to RWI and what can you expect when you get there? To answer these questions, Bryan and Gena are joined by David Anderson, CEO & Executive Recruiter at Greenwich Executive Group, and a noted executive recruiter who has a specialty niche in the RWI industry. In the episode, Bryan, Gena, and Dave discuss: • How Dave's background as a former reps and warranties underwriter at the Hartford and Concord led him to his current role as a RWI recruiter • Why a position as an underwriter or broker in RWI is different from—and better than—other in-house jobs • Skill sets that underwriting shops value beyond just M&A experience • Future career opportunities in transactional risk niches such as tax insurance and contingent risk • Pay and benefits that underwriters can expect

Even though RWI is an innovative product, most practitioners in the space utilize a decidedly low-tech approach to the deal process: a seemingly endless stream of emails back and forth between insurers, brokers, insured, and underwriting counsel. This cumbersome process can lead to lost productivity and an inefficient use of time. The RW-Exchange (www.RW-Exchange.com) is a new tech resource that specifically targets the RWI process and aims to make transactional risk insurance placements more streamlined and organized, thereby adding value and saving time. In this episode, Bryan and Gena go “high-tech” with Kirk Sanderson, Founder and Managing Partner at M&A Insurance Solutions, and the creator of the RW-Exchange, to discuss: · How Kirk developed the RW-Exchange concept · An explanation of the features and benefits of the RW-Exchange · How using this new resource can save insurers, brokers, and attorneys valuable time · Pricing for the product · Steps on how to utilize it in your next transaction

The ability to cabin off problematic litigation through the strategic use of insurance is an underappreciated segment of the transactional risk insurance markets. In the same vein, as the product matures, contingent risk insurance may play an important role in allocating risk outside of transactions as well. In this episode, Bryan and Gena are joined by David Haigh, Managing Director, Atlantic Global Risk, and Sara Cannon, Senior Vice-President and Head of Structured Solutions, Atlantic Global Risk, to discuss: · An overview of the contingent risk insurance product · Potential use of contingent risk insurance both as part of a deal and outside of a transaction · Specific industries that have started successfully utilizing the product · The latest policy limits, premiums, retentions, and claims experience · Predictions on how contingent risk can be used in the future

With the explosion of the RWI product and increase in the number of insurance carriers, buyer insured have watched reps and warranties insurance evolve in the past five years and are now faced with important choices to make when it comes to selecting a carrier to underwrite a reps and warranties insurance policy. In this episode, Bryan and Gena are joined by prominent private equity attorney, Neal Reenan, Partner, Latham & Watkins to discuss: • The growth of the RWI product from the buy-side perspective • How buyers differentiate and select insurers beyond price • The importance of a carrier's claims process and history • Practical recommendations for insurers on how to improve the RWI process • The key role that underwriting counsel play in the transaction from the buy-side counsel's perspective

While the traditional PE buyout market still comprises the bulk of RWI deals, the product is starting to gain traction in a variety of new contexts. These “outside the box” approaches represent novel ways to expand the use of reps and warranties insurance and touch previously untapped industries and sectors. In this episode, Bryan and Gena are joined by their first international guest, the UK-based Angus Marshall, Global Practice Leader, Transactional Liability, CFC Underwriting to discuss: · A view of RWI from across the pond · The expanding use of RWI in PE secondaries transactions · How RWI can be the right solution for deals involving small and medium-sized enterprises · The capability of markets to underwrite SPAC and public transactions

The reps and warranties industry is well-known for having a series of conferences throughout the year where insurers, brokers, insured, and outside counsel discuss critical issues facing the industry. The COVID-19 pandemic has scuttled these in-person events for 2020 and likely beyond. CAC Specialty recently hosted its first-ever virtual conference with multiple panels devoted to RWI. In this episode, Bryan and Gena are joined by David Barnes Senior Vice President at CAC Specialty and Michael Wakefield, Senior Vice President & Transactional Insurance Practice Leader at CAC Specialty to discuss: • The inspiration for the recent CAC virtual conference • The challenges and opportunities that the virtual format presented • Recap of the RWI panels and keynote speaker, author Michael Lewis • Plans for CAC's conference next year

Everyone knows the drill: you find out that the insured is buying your policy, but the parties want to sign ASAP. Suddenly, the insurer is pressured to finish underwriting, due diligence, and meet the parties expectations, all while not missing any critical issues. In this episode, Bryan and Gena are joined by Nick Tuliebitz, Co-Head of M&A Insurance North America at AssuredPartners. Nick will review his top 5 tips for RWI underwriting and due diligence on a tight timeline including: • The advantage to using the buyer's mark-up of the purchase agreement on R&W submissions • The importance of not rushing the underwriting call, no matter the circumstances • Strategic ways to use conditional exclusions on the policy • Remembering that the RWI policy can be bound after signing • Keeping perspective

Since COVID-19 struck, the transactional risk insurance markets have been faced with difficult questions on how to address a potential COVID-19 exclusion from RWI policies. In this episode, Bryan and Gena are joined by Scott Pegram, Senior Underwriting Manager at Liberty Global Transaction Solutions to discuss: • The current state of M&A and the continuing impact of COVID-19 • Liberty's approach to the COVID-19 exclusion • Predictions about where risk markets are headed in the coming months as the pandemic lingers