New Heights for M&A Insurance Claims Payouts, Aon Study Reveals
Aon's North America claims team has helped facilitate over 100 paid claims for clients in the last three years, including 39 in 2024 alone, which recovered over $300m, with a median payment of $5.5m.
Activity in Europe, the Middle East and Africa (EMEA) continues to increase year-over-year, with claims notifications up by 26 percent in 2024 and the quantum of W&I claims payments up significantly, with recoveries in 2024 alone accounting for more than 35 percent of all paid claims for Aon clients in the region to date. The study analyzes claims severity and payment trends in EMEA against the wider backdrop of regional M&A deal activity, with a spotlight on key jurisdictions and success stories.
In the Asia Pacific (APAC) region, a number of key trends have emerged including an increasing variety of categories of W&I breaches being claimed in Asia, including an increasing proportion of regulatory, litigation-related and disclosure-related claims, a high incidence of disclosure-related breaches in Australia and New Zealand (ANZ) representing almost 30 percent of W&I claims, as well as a consistent relatively high frequency of claims in smaller transactions particularly in ANZ. Asia has also seen a larger number of W&I and tax liability policy claims coming out of India-based risks in 2024 (making up more than 30 percent of all Asia claims), with tax risks relating to both cross-border treaty matters as well as fully domestic Indian tax risks.
Drivers of R&W and W&I claims
In North America, R&W claims were driven by alleged breaches of warranties relating to compliance with laws (20 percent), followed by tax (17 percent) and material contracts (13 percent).
In EMEA, breach of tax warranties (26 percent) represented the top driver by frequency for W&I claims, but the biggest drivers of paid claims were breaches of warranties relating to financial statements (27 percent), compliance with laws (13.2 percent) and material contracts (11 percent).
In APAC, the top W&I claims drivers were breaches of warranties relating to material contracts (19 percent) and legal compliance, tax and license permits, all at 12.5 percent of claims.
Cross-industry comparisons
Aon's Global Transaction Solutions Claims Study analyzes industry sectors in North America to draw comparisons between deals, claims and payments and the issues driving loss. Despite the different risk profiles between sectors, there is a remarkably even distribution across the identified industries for claim frequency and severity when compared to the percentage of deals they comprise in the overall deal pipeline.
Dealmakers can apply the sector insights gathered to inform their approach for subsequent M&A activity in that industry, while insurers may be comforted that there is no one 'high risk' industry for R&W breaches.
'Understanding global M&A insurance claims trends isn't just insightful — it's essential to helping our clients navigate risk and make smarter deal decisions. R&W insurance has become an embedded part of dealmaking and risk mitigation, as evidenced through this most recent record year in claims payouts. It offers critical protection that enables transaction execution with greater confidence,' said Stephen Davidson, global head of claims at Aon. 'This study reinforces that while the coverage itself is vital, the real key to successful claims outcomes lies in collaboration. When insurers, brokers and insureds work together, we consistently see fair, efficient resolutions that preserve deal value and support long-term client success.'
Other key findings from the report include:
Aon has been involved in over 1,600 notified R&W and W&I claims, helping its clients to secure over $1.75bn in payments globally.
More than $500m has been paid to Aon clients on notices submitted more than 12 months post-close of the transaction.
To the end of 2024, the Aon claims team has worked with insurers to recover almost $200m in paid claims for Aon's EMEA clients.
A steady rise in the rate of notifications across Asia shows insureds becoming more aware of policy benefits and the importance of engaging with their broker at the inception of the claim.
About Aon
Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that protect and grow their businesses.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time Business News
an hour ago
- Time Business News
PM Modi Arrives In Argentina: Powerful Bilateral Visit Strengthens Partnership
New Delhi – Indian Prime Minister Narendra Modi arrives in Argentina for a landmark two-day visit that represents the first Indian bilateral visit at the prime ministerial level to the South American nation in 57 years. The historic visit commenced on Friday, July 4, 2025, as PM Modi Arrives In Argentina received a ceremonial welcome at Buenos Aires's Ezeiza International Airport, marking a significant milestone in India-Argentina diplomatic relations. This strategic visit forms the third stop of Prime Minister Modi's comprehensive five-nation tour, following his successful two-day engagement in Trinidad and Tobago. The timing of this visit underscores the growing importance of Latin American partnerships in India's global diplomatic strategy and economic outreach. The centerpiece of this diplomatic mission involves extensive talks between Prime Minister Modi and Argentine President Javier Milei. PM Modi arrives in Argentina with a comprehensive agenda focused on strengthening bilateral cooperation across multiple sectors. The two leaders, who previously met in 2024, are set to engage in wide-ranging discussions designed to elevate the India-Argentina partnership to new heights. President Milei's administration has shown keen interest in expanding ties with India, particularly in sectors where Argentina possesses significant competitive advantages. The discussions are expected to yield concrete outcomes that will benefit both nations' economic and strategic interests in the coming years. Agriculture represents a cornerstone of the bilateral partnership discussions. PM Modi arrives in Argentina recognizing the nation's position as a global agricultural powerhouse, with both countries sharing expertise in sustainable farming practices, food processing technologies, and agricultural innovation. The cooperation framework aims to enhance food security while promoting sustainable agricultural development. The energy sector partnership holds particular significance as both nations seek to diversify their energy portfolios. PM Modi arrives in Argentina with proposals for collaboration in renewable energy projects, oil and gas exploration, and critical minerals extraction. Argentina's rich lithium reserves and India's growing energy demands create natural synergies for long-term partnership development. Defense cooperation represents another vital pillar of the bilateral relationship. The discussions are expected to explore opportunities for technology transfer, joint training programs, and equipment collaboration. This security partnership aligns with both nations' broader strategic objectives in their respective regions. Trade relations between India and Argentina have shown steady growth, and PM Modi arrives in Argentina with specific proposals to further expand bilateral commerce. The discussions focus on removing trade barriers, enhancing market access, and creating favorable conditions for increased bilateral trade volumes. Technology transfer and innovation partnerships form crucial components of the bilateral agenda. PM Modi arrives in Argentina with India's expertise in information technology, pharmaceuticals, and digital solutions, while Argentina offers opportunities in biotechnology, agricultural technology, and renewable energy innovations. Investment facilitation measures are expected to receive significant attention during the talks. Both nations recognize the potential for increased foreign direct investment flows, particularly in infrastructure development, manufacturing, and service sectors. The visit gains additional significance given both countries' active participation in the G20 framework. PM Modi arrives in Argentina acknowledging the nation's role as a key collaborator in international forums. The discussions are expected to address global challenges, including climate change, sustainable development, and international trade policies. Argentina's previous hosting of the G20 summit and India's upcoming presidency provide natural opportunities for enhanced cooperation in multilateral settings. The bilateral partnership strengthens both nations' positions in international negotiations and global governance initiatives. Tourism cooperation represents an emerging area of bilateral engagement. PM Modi arrives in Argentina recognizing the potential for increased people-to-people connections through enhanced tourism infrastructure and cultural exchange programs. These initiatives aim to strengthen the foundation of bilateral relations through deeper cultural understanding and economic benefits. This Argentine visit forms part of Prime Minister Modi's broader diplomatic initiative spanning five nations. PM Modi arrives in Argentina after successfully concluding engagements in Trinidad and Tobago, where he received the highest civilian honor and signed six bilateral agreements. The comprehensive tour demonstrates India's commitment to expanding its global partnerships and diversifying its international relationships. Following the Argentine visit, the Prime Minister's itinerary includes participation in the 17th BRICS Summit in Brazil, followed by a state visit to the same country. The tour concludes with a visit to Namibia, completing a comprehensive engagement with nations across different continents and regional groupings. The Ministry of External Affairs has characterized this visit as instrumental in deepening the multifaceted strategic partnership between India and Argentina. PM Modi arrives in Argentina with concrete proposals designed to transform bilateral relations from traditional diplomatic engagement to comprehensive strategic cooperation. The partnership framework encompasses defense, agriculture, mining, oil and gas, renewable energy, trade, and investment sectors. This comprehensive approach reflects both nations' commitment to building sustainable, long-term cooperation that addresses mutual interests and global challenges. PM Modi arrives in Argentina during a period of significant global economic and political transformation. The visit represents more than traditional diplomatic engagement; it signifies India's strategic pivot toward Latin America and Argentina's recognition of India's growing global influence. The 57-year gap since the last prime ministerial visit underscores the historic nature of this engagement. Both nations recognize the untapped potential in their bilateral relationship and are committed to establishing frameworks for sustained cooperation across multiple sectors. This historic visit positions both countries to leverage their complementary strengths, with India's technological expertise and manufacturing capabilities complementing Argentina's natural resource wealth and agricultural prowess. The partnership promises to yield significant benefits for both nations while contributing to broader regional stability and prosperity. The outcomes of this visit will likely establish new benchmarks for India-Argentina relations and serve as a model for India's engagement with other Latin American nations in the years ahead. Author Credits TIME BUSINESS NEWS
Yahoo
an hour ago
- Yahoo
Here's Why We Think Gorman-Rupp (NYSE:GRC) Might Deserve Your Attention Today
Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks' without any revenue, let alone profit. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. Loss-making companies are always racing against time to reach financial sustainability, so investors in these companies may be taking on more risk than they should. So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like Gorman-Rupp (NYSE:GRC). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. If a company can keep growing earnings per share (EPS) long enough, its share price should eventually follow. That makes EPS growth an attractive quality for any company. Over the last three years, Gorman-Rupp has grown EPS by 14% per year. That's a pretty good rate, if the company can sustain it. One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. Gorman-Rupp reported flat revenue and EBIT margins over the last year. While this doesn't ring alarm bells, it may not meet the expectations of growth-minded investors. You can take a look at the company's revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers. View our latest analysis for Gorman-Rupp Fortunately, we've got access to analyst forecasts of Gorman-Rupp's future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting. It's pleasing to see company leaders with putting their money on the line, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. So it is good to see that Gorman-Rupp insiders have a significant amount of capital invested in the stock. Notably, they have an enviable stake in the company, worth US$215m. Coming in at 21% of the business, that holding gives insiders a lot of influence, and plenty of reason to generate value for shareholders. Very encouraging. It means a lot to see insiders invested in the business, but shareholders may be wondering if remuneration policies are in their best interest. Our quick analysis into CEO remuneration would seem to indicate they are. The median total compensation for CEOs of companies similar in size to Gorman-Rupp, with market caps between US$400m and US$1.6b, is around US$3.7m. The Gorman-Rupp CEO received US$2.0m in compensation for the year ending December 2024. That seems pretty reasonable, especially given it's below the median for similar sized companies. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. Generally, arguments can be made that reasonable pay levels attest to good decision-making. One important encouraging feature of Gorman-Rupp is that it is growing profits. The fact that EPS is growing is a genuine positive for Gorman-Rupp, but the pleasant picture gets better than that. Boasting both modest CEO pay and considerable insider ownership, you'd argue this one is worthy of the watchlist, at least. Even so, be aware that Gorman-Rupp is showing 1 warning sign in our investment analysis , you should know about... While opting for stocks without growing earnings and absent insider buying can yield results, for investors valuing these key metrics, here is a carefully selected list of companies in the US with promising growth potential and insider confidence. Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
2 hours ago
- Yahoo
A Look At The Fair Value Of Keysight Technologies, Inc. (NYSE:KEYS)
Using the 2 Stage Free Cash Flow to Equity, Keysight Technologies fair value estimate is US$180 Current share price of US$167 suggests Keysight Technologies is potentially trading close to its fair value Analyst price target for KEYS is US$183, which is 2.1% above our fair value estimate Today we will run through one way of estimating the intrinsic value of Keysight Technologies, Inc. (NYSE:KEYS) by taking the forecast future cash flows of the company and discounting them back to today's value. Our analysis will employ the Discounted Cash Flow (DCF) model. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we discount the value of these future cash flows to their estimated value in today's dollars: 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Levered FCF ($, Millions) US$1.18b US$1.36b US$1.47b US$1.58b US$1.67b US$1.75b US$1.82b US$1.89b US$1.96b US$2.02b Growth Rate Estimate Source Analyst x4 Analyst x3 Analyst x1 Analyst x1 Est @ 5.58% Est @ 4.79% Est @ 4.23% Est @ 3.85% Est @ 3.57% Est @ 3.38% Present Value ($, Millions) Discounted @ 7.8% US$1.1k US$1.2k US$1.2k US$1.2k US$1.1k US$1.1k US$1.1k US$1.0k US$993 US$952 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$11b We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.9%. We discount the terminal cash flows to today's value at a cost of equity of 7.8%. Terminal Value (TV)= FCF2035 × (1 + g) ÷ (r – g) = US$2.0b× (1 + 2.9%) ÷ (7.8%– 2.9%) = US$43b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$43b÷ ( 1 + 7.8%)10= US$20b The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is US$31b. To get the intrinsic value per share, we divide this by the total number of shares outstanding. Compared to the current share price of US$167, the company appears about fair value at a 7.0% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Keysight Technologies as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.8%, which is based on a levered beta of 1.130. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Check out our latest analysis for Keysight Technologies Strength Debt is not viewed as a risk. Weakness Earnings declined over the past year. Opportunity Annual earnings are forecast to grow for the next 3 years. Current share price is below our estimate of fair value. Threat Annual earnings are forecast to grow slower than the American market. Although the valuation of a company is important, it is only one of many factors that you need to assess for a company. DCF models are not the be-all and end-all of investment valuation. Preferably you'd apply different cases and assumptions and see how they would impact the company's valuation. For instance, if the terminal value growth rate is adjusted slightly, it can dramatically alter the overall result. For Keysight Technologies, we've compiled three relevant items you should consider: Risks: Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Keysight Technologies , and understanding it should be part of your investment process. Future Earnings: How does KEYS's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks just search here. — Investing narratives with Fair Values Suncorp's Next Chapter: Insurance-Only and Ready to Grow By Robbo – Community Contributor Fair Value Estimated: A$22.83 · 0.1% Overvalued Thyssenkrupp Nucera Will Achieve Double-Digit Profits by 2030 Boosted by Hydrogen Growth By Chris1 – Community Contributor Fair Value Estimated: €14.40 · 0.3% Overvalued Tesla's Nvidia Moment – The AI & Robotics Inflection Point By BlackGoat – Community Contributor Fair Value Estimated: $359.72 · 0.1% Overvalued View more featured narratives — Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
