20 March 2026
Global M&A Insurance 2024 Review and 2025 Outlook
The transactional insurance market remained open for business in 2025 and continued to grow in the Private Capital and Corporate space.
Submission volumes rose year-on-year, a number of new managing general agent (MGA) and insurer entrants joined the market, albeit we also saw some exits from both MGAs and capacity providers, insurers continued to broaden appetite by deal size, structure, and geography, and product innovation accelerated across Warranty & Indemnity (“W&I”)/Representations & Warranties (“R&W”), Tax, Insurance Due Diligence (“IDD”), and Contingent Risk solutions.
As Gallagher accelerated our investment in our global M&A and Private Capital focussed capabilities building on our existing platforms in USA, Canada, UK and Australia with new hires in those existing locations and in new locations such as India, UAE, Iberia, Benelux and the Nordics, the key global themes observed during 2025 included:
Volumes, pricing, and retentions
Submission volumes increased in 2025 versus 2024, with one prominent global insurer reporting an approximate 17% year-on-year rise in submissions, alongside an estimated 5% increase in average deal value.
Gallagher’s Global M&A teams all experienced very strong growth in 2025 (versus 2024) driven by deal teams’ familiarity with transactional insurance products, which are now well-established across core markets. Insurers are increasingly willing to provide solutions across the full spectrum of deal sizes and structures — from enterprise values (“EV”) below £/$/€5 million through to multi-billion transactions — and across a broader range of jurisdictions.
After several years of premium rate decline, certain insurers have begun to re-align pricing to better reflect the risks being underwritten and the claims environment.
Retentions (policy excess) continued to trend downwards across much of the market. Tipping-to-nil structures are now broadly available on most deals, and nil retention outcomes can be achieved on certain transactions depending on risk profile and process. That said we are also seeing an increase in interest from clients wanting to secure coverage above more significant retention levels reflecting their risk appetite and / or approach to general materiality thresholds.
Looking ahead, there is cautious optimism for 2026, supported by ample investment capital from private capital funds and corporates with strong balance sheets, stabilising interest rates, and recovering valuations.
That optimism is, however, tempered by the evolving Middle East conflict, which has increased volatility in energy markets, disrupted regional supply chains, and introduced new geopolitical risks that deal teams must factor into pricing, diligence and execution plans.
2026 therefore presents significant opportunity — albeit in an increasingly unpredictable and fast-changing environment. In that context, insurance solutions that mitigate and manage a wide range of risks can serve as a powerful catalyst to unlock transaction momentum.
Territory Analysis
UK and EEA
Transactional insurance continued to be an important instrument in M&A across the UK and EEA regions in 2025. Within this backdrop, competition amongst the transactional insurers remained intense leading to a continued “soft” market with premiums and retention levels at a historic low along
United States
Liquidity remained a defining theme in 2025, constrained as limited partners pressed general partners for realised distributions, and traditional exits lagged. According to PitchBook’s Q3 2025 US PE Breakdown
Canada
2025 was a unique year for Canadian transactions. Deal activity at the start of the year was materially impacted as the market assessed tariff materiality. We saw a 60% reduction in inbound deals between Q1 2024 and Q1 2025.
Asia Pacific
After a promising start to 2025, the Asia-Pacific M&A market was moderately impacted by macro volatility, recession fears, geopolitical risks, and ongoing tariff policy shifts. However, in the second half of the year, the region demonstrated resilience and renewed dealmaking optimism.
India
In India, transaction risk insurance — including W&I, tax warranties, and contingent risk policies — is increasingly becoming part of “how deals are done”, rather than an optional add-on. As deal activity picks up, insurance providers are increasingly comfortable across most sectors and jurisdictions, supporting broader adoption.
South America
R&W insurance continues to gain traction across Latin America as an alternative to traditional post-closing risk allocation mechanisms such as escrows and holdbacks. The market has expanded meaningfully as insurer participation has increased, enabling more competitive pricing and broader coverage options..
Middle East
2025 began with cautious optimism for increased M&A activity globally, but headwinds proved stronger than anticipated — tariffs, interest rates, financial markets, and regional conflicts. Uncertainty remains the defining feature. Global M&A volume dropped in the first half of 2025 by 9% (PwC, Global M&A industry trends: 2025 mid-year outlook).
Africa
As the European market becomes more competitive, insurers are increasingly willing to underwrite a broader range of African jurisdictions, with more underwriters dedicating capacity to the region. In 2025, Gallagher worked on transactions involving Uganda, Tanzania, Kenya, the Central African Republic, Nigeria, and others.
Tax Insurance
The tax insurance market continues to go from strength to strength and has become a natural hedge to volatility experienced within the broader M&A insurance market. Growth is being driven by increased enquiries involving tax risks not tied to an underlying transaction (e.g., operational tax risks, risks under audit or in active challenge, group restructures, forward-looking risks, and fund wind-ups).
Market capacity is growing, with new entrants continuing. The market now consists of c.25 specialist tax insurers in the UK/Europe, with another 5–10 operating more exclusively in North America. Five years ago, there were roughly 11 specialist tax insurers in the UK/Europe.
Appetite is expanding geographically, although certain risks are attracting increased underwriter sensitivity, including Spain and certain UK stamp duty risks. In Canada, broad mandatory reporting rules have caused insurers to be more selective. That said, Gallagher has a strong Canadian pipeline and has placed risks with exposures of c.$300m.
We are also seeing expansion into emerging jurisdictions where rates are higher, with South Korean, Middle Eastern, Peruvian, and Colombian tax risks attracting interest.
Following the recent judgement in Tiger Global the tax insurance market experienced some ripples and uncertainty with regards to appetite for insuring Indian double tax treaty risks (in particular, in respect of the India-Mauritius treaty). The market however has remained resilient with several markets continuing to show appetite for Indian tax risks. There have been a few markets that have paused pending further developments, most other markets are applying an increased level of scrutiny to risks and seeking to cover risks with very clear positions on substance. Notably, the focus on seeking to ‘over-underwrite’ a position (e.g. to ensure that Insureds had a very strong defence file going further than relying on a ‘Tax Residency Certificate’) has been the standard position for years. We expect for the next 6 months or so there will be added scrutiny.Claims are an increasingly important trend. As the market has matured, notifications are rising, including tax authority enquiries across multiple jurisdictions. Underwriters are differentiating themselves through responsiveness and collaboration during the claims process. Claims capability is also an important differentiator for clients when choosing a broker; Gallagher’s claims resources include over 20 claims specialists (qualified solicitors).
We expect the tax insurance market to continue rapid growth in 2026, with increasing appetite for emerging jurisdictions. Based on growth over the past two years, it is possible that the tax insurance market could overtake the W&I/RWI insurance market within the next 10 years.
CONTINGENT RISKS INSURANCE
As 2026 comes into focus, the Contingent Risk Insurance (“CRI”) market is set to build on the steady momentum of 2025, driven by increasing transaction complexity, a reduction in liquidity, and the need for innovative risk management solutions for capital deployment. CRI is proving valuable in facilitating deals — particularly in restructuring and financing contexts — and can deliver significant balance sheet benefits by reducing the need for large provisions.
Market trends and outlook
Supporting restructurings and financing CRI is increasingly utilised where specific liabilities create uncertainty for creditors, lenders, and other stakeholders. By ring-fencing liabilities or protecting capital, CRI enables smoother negotiations, facilitates creditor distributions, and provides certainty to proceed.
Facilitating complex transactions In M&A and other high-stakes transactions, CRI can address discrete risks that might otherwise derail a deal. By removing liabilities from the negotiating table, CRI helps align stakeholders, expedite timelines, and reduce execution risk.
Balance sheet optimisation A core benefit of CRI is reducing the need for large balance sheet provisions by transferring defined risks to insurers, freeing capital, improving ratios, and presenting a cleaner balance sheet — particularly relevant in restructuring scenarios.
Competition among CRI underwriters continues to increase, driving product innovation and streamlined underwriting. Awareness is also increasing, with more dealmakers recognising CRI’s value where certainty and flexibility are critical.
Key considerations
Engagement often occurs during (or shortly after) legal due diligence. Bespoke policies take time; clarity on risk appetite and acceptable self-insured retention helps streamline discussions and secure terms. Well-documented legal arguments supported by credible legal opinions improve underwriting outcomes, as does careful presentation of how a claim would materialise in practice.
CRI is expected to play an even greater role in 2026, particularly in restructurings and financing, while delivering meaningful balance sheet benefits. The key is early engagement with underwriters and strong legal/jurisdictional presentation to put distance between the transaction and a claim event. By leveraging CRI to address specific liabilities, insureds can unlock strategic advantages, optimise financial position, and support smoother transaction processes.
INSURANCE DUE DILIGENCE (IDD)
Why IDD matters
Insurance Due Diligence (“IDD”) continues to perform a critical function in the transaction process, helping deal teams understand a target’s risks and make informed decisions about risk transfer and risk management. In time-sensitive transactions, unforeseen risks can arise post-completion. IDD assesses the adequacy of the target’s insurance programme, identifies gaps (including change of control provisions), critiques programme cost, and recommends enhancements.
In 2025, the Insurance DD team worked across core jurisdictions (UK, USA, Australia) as well as an increasing number of projects across Europe, India, Africa, and Asia-Pacific. Our experience spanned project financing (including government financing entities in mining sectors), large-scale hospitality and leisure, infrastructure projects (telecommunications real assets, data centres, hybrid renewables platforms, utilities, toll roads), and a wide range of middle-market operating businesses (including vertical integration and consolidation strategies) as well as regulated asset sale processes.
Core IDD workstreams
Insurance issues impacting the deal
- Identifying risks that could affect the buyer’s decision to proceed.
Current and future insurance exposures
- Evaluating compliance with contractual, statutory, and third-party insurance obligations.
Existing insurance programme
- Change of control provisions (policies requiring intervention post-transaction).
- Benchmarking (coverage and costs versus peers).
- Programme deficiencies (underinsured/uninsured risks).
- Run-off terms (cancellation penalties, refunds, insurer security ratings).
Post-closing insurance programme
- Optimal structure for the “go-forward” programme.
- Cost estimates (renewal costs, insurance not historically purchased, and one-off transaction costs).
Purchase agreement and transaction documents
- Identifying key insurance risks and value points.
- Supporting SPA negotiations.
- Enabling W&I underwriters to conduct risk analysis and take a pragmatic approach to coverage.
IDD is increasingly important as risk dynamics continue to shift and transaction complexity grows. Gallagher’s IDD team assists deal teams to improve clarity, reduce uncertainty, and support execution.
LENDERS INSURANCE DUE DILIGENCE
The real estate finance sector continues to experience dynamic shifts driven by evolving market demands and strategic lender activity. Debt funds continue to grow, with larger players now entering the mid-market while maintaining focus on larger scale loans, reflecting appetite for diversified opportunities and tailored financing solutions.
Geographically, lender activity is expanding across Europe, with heightened interest in regions such as the Nordics. This creates challenges navigating local insurance market practices and differing insurance strategies across territories. Gallagher’s Lenders’ Insurance Advisory services provide lenders with critical insights to ensure arrangements align with regional requirements and best practice.
There is also a marked push for value-add opportunities, particularly refurbishment projects. This shift, driven by sustainability pressures and environmental concerns, requires nuanced insurance structuring to ensure existing structures and refurbishment costs are appropriately covered.
Operational real estate businesses remain a focal point for lenders, requiring deeper due diligence, including cash flow scrutiny. Business interruption cover is a critical consideration to protect income streams against disruption.
As the lending sector evolves, insurance due diligence is increasingly vital in supporting lenders to mitigate risk, address emerging challenges, and pursue opportunities with confidence.
Conclusion
Despite ongoing macroeconomic uncertainty and uneven M&A volumes in 2025, the global M&A insurance market demonstrated resilience, depth, and continued evolution. Capacity remains abundant, coverage terms are broadly favourable, and transactional insurance solutions are now firmly embedded in deal execution across geographies, sectors, and deal sizes.
While pricing and retentions show early signs of recalibration in response to claims experience, competition and innovation continue to support flexible, efficient risk transfer. Growth in secondary transactions, tax and tax credit insurance, contingent risk solutions, and insurance due diligence reflects a market increasingly focused on certainty, capital efficiency, and post-close outcomes.
Looking ahead to 2026, stabilising financial conditions, significant deployable capital, and continued pressure to transact are expected to continue to support deal activity.
However, the evolving Middle East conflict has introduced an additional layer of geopolitical volatility, influencing energy markets, supply chains, and investor sentiment. Its trajectory is likely to shape deal timetables, risk allocation, and cross‑border capital flows through the year.
In this environment, M&A insurance will remain a critical enabler—helping dealmakers bridge valuation gaps, manage complexity, unlock liquidity, and execute transactions with greater confidence in an increasingly complex and fast-moving global landscape.
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