India sees 30% rise in transactional risk insurance claims: Marsh report

Private equity-backed transactions accounted for 92% of claim notifications, with tax-related issues emerging as the most common trigger

India is witnessing a steady rise in claim notifications under transactional risk insurance policies, with overall notifications increasing 30 per cent year-on-year (YoY), reflecting deeper adoption of such covers in mergers and acquisitions (M&A) transactions amid increasingly complex deal structures and an active regulatory environment, according to a report by Marsh.

 

India accounted for 33 per cent of all transactional risk insurance claim notifications in Asia in 2025.

 

Transactional risk insurance is used in M&A transactions to protect buyers, sellers and investors against losses arising from breaches of representations and warranties, tax liabilities, and other deal-specific risks identified during a transaction.

 

According to the report, 92 per cent of claim notifications originated from private equity-backed transactions, while corporate insureds accounted for the remaining 8 per cent. The report attributed this to the widespread use of warranty and indemnity (W&I) and tax insurance in private equity deals, particularly in competitive auction processes where such covers are often integral to securing preferred bidder status.

 

Tax-related issues remained the most common trigger under W&I policies, accounting for 50 per cent of notifications in India. Breaches related to compliance-with-laws warranties made up 33 per cent, while the remaining claims were spread across a range of warranty types.

 

Sanjay Kedia, chief executive officer and president, Marsh India, said, “As India’s deal landscape becomes larger and more sophisticated, transactional risk insurance is increasingly being viewed as a strategic tool to manage complexity, mitigate downside risks, and enhance deal certainty. We are seeing growing awareness among Indian corporates and investors around the importance of structured risk-transfer solutions, particularly as claims activity continues to rise across the region.”

 

While no claims were notified in the first quarter, 54 per cent were filed in the second quarter, 31 per cent in the third quarter, and 15 per cent in the fourth quarter. Marsh said the concentration of notifications in the second quarter reflected activity following the financial year-end, while notifications continuing into the third quarter were largely driven by tax policy-related issues.

 

Aditya Samag, private equity and M&A leader, Marsh India, said, “India’s transactional risk insurance market is evolving rapidly alongside the country’s M&A ecosystem. Increasing claim notifications, particularly around financial statement and tax-related exposures, reinforce the importance of robust due diligence, proactive claims management, and transaction-specific insurance structuring to protect value and support smoother deal execution.”