Marsh, a leading insurance broker and risk advisor under the Marsh McLennan umbrella, has released its 2024 Transactional Risk Insurance Year in Review report, highlighting significant trends and developments in the market over the past year.
The transactional risk insurance market saw remarkable growth in 2024, making it one of the most active years on record. Marsh facilitated $67.8 billion in insurance limits, marking a 38% increase compared to the previous year.
This growth was driven by a 33% rise in the number of policies issued and a 31% increase in unique transactions. These figures underscore the growing reliance on insurance to mitigate risks in complex deals.
The market conditions in 2024 were favorable for buyers, with pricing for primary layers of Representations and Warranties (R&W) and Warranty and Indemnity (W&I) insurance declining across all regions. This trend benefited sectors such as technology, healthcare, and renewable energy, which played a pivotal role in the surge of transactional risk insurance usage. Notably, the renewable energy sector saw a significant rise in tax insurance, as businesses sought coverage for investment and production tax credits, reflecting broader efforts toward sustainability.
Emerging markets also witnessed a surge in adoption, particularly in Latin America and Africa. In these regions, insurers expanded their capacity to support cross-border transactions.
Throughout 2024, underwriting conditions remained favorable, with strong capacity across the globe. In North America and Europe, single transactions often secured up to $1 billion in coverage. However, by the end of the year, insurers began exercising more caution in deploying limits due to an increase in claims from larger insurance programs.
The report also noted a rise in claims activity, with North America and EMEA experiencing increases of 20% and 30%, respectively. In contrast, claims in Asia remained stable compared to 2023, while the Pacific region saw a slight decrease in claims notifications.
Craig Schioppo, Global Head of Transactional Risk at Marsh, commented, “Last year marked a pivotal year for transactional risk insurance, with a notable recovery in global M&A activity and an increased recognition of the value of insurance solutions in managing transaction-related risks.”
Despite ongoing geopolitical uncertainty impacting global M&A activity into Q1 2025, Schioppo expressed optimism for continued market growth, emphasizing its role in supporting successful transactions across various sectors.
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