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Mergers & Acquisitions 2024 Transactional Risk Report

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Marsh globally placed transactional risk insurance limits of US$67.8 billion (up 38% from 2023) on over 2,750 policies (up 33% from 2023) across nearly 1,600 unique transactions (up 31% from 2023), representing over US$342 billion in aggregate enterprise value.

Another record year for Asia

Marsh Private Equity and Mergers & Acquisitions Services team in Asia placed a record 318 transactional risk policies – both primary and excess – across 148 completed deals. This represented a 30% increase in policy placements compared with 2023, providing over US$7.8 billion in protection limits for our clients and insuring transactions with an aggregate enterprise value exceeding US$32.5 billion. 

Asia claims volume remained stable 

In 2024, Asia recorded 20 notifications across 19 standalone deals. While the number of notifications was similar to 2023, there was a 46% increase in the number of standalone deals impacted. Tax claims outnumbered other drivers of losses in the region, accounting for 47% of all breaches notified in 2024, which represents a 15% increase compared to 2023. Financial statement breaches, absent in 2023, rose to represent 27% of all claims notified in 2024. 

Read the full report for trends on Asia and the region’s individual markets.

Key Asia highlights:

  • W&I Insurance market: 
    • Competition among W&I insurers remained robust, with businesses benefiting from more competitive pricing, improved policy terms, enhanced coverage, and less burdensome information requirements during underwriting.
    • Impact on insurance pricing: The average premium rate for Asia fell by 24%, from 1.7% in 2023 to 1.3% in 2024.
    • Impact on policy parameters: Many insurers have offered more favourable retention (e.g. 0.25% of enterprise value) and de minimis options for their policies. 
    • Impact on policy terms and conditions: Insureds continue to benefit, as some insurers agreed to remove common jurisdiction-specific exclusions. 
    • Impact on process: Insurers continued to focus on streamlining the underwriting process as a key differentiator, such as minimising underwriting questions, eliminating underwriting calls and more.
    • Rise in deal sizes: The proportion of deals valued between US$100 million to US$250 million increased significantly, from 20% to 33%. Conversely, the proportion of deals valued at US$50 million and below dropped from 25% to 15%.     
  • Tax liability insurance:
    • Demand for the product has increased due to greater client awareness and expanded insurer appetite, with premium rates for Asian tax risks ranging from 2% to 5%. 
    • Key risks insured include those related to the double tax avoidance agreement (DTAA) and coverage of domestic tax risks.
    • The use of tax insurance has expanded across the region, notably in China, Indonesia, Japan, South Korea, Singapore, and Vietnam. 
  • Top industries: 
    • Real estate overtook manufacturing as the top industry utilising transactional risk insurance in the region, followed by healthcare and communications, media, and technology.
  • Geography trends:
    • Japan: Outbound M&A activity experienced a resurgence, particularly towards the US, with these transactions comprising over 20% of the completed deal portfolio. Average premium rates fell by around 18%, from 2% in 2023 to just under 1.6% in 2024.
    • Southeast Asia: M&A activity in Southeast Asia recovered in 2024, with strong deal flow throughout the year. Average premium rates fell by 21%, from 1.4% in 2023 to 1.1% in 2024.
    • South Korea: An upturn in dealmaking later in 2023 saw the number of deals completed by our team increase by 75%. Average premium rates declined by 20%, from 1.8% in 2023 to just under 1.4% in 2024. 

Navigate the complexities of today’s M&A market with actionable insights to mitigate risks and seize opportunities. Download your copy of the M&A Transactional Risk Report here.

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