Author: Alistair Lester
As we look back at 2025 the global transactional insurance market continued to demonstrate resilience and growth throughout the year, particularly in the private capital and corporate sectors. Submission volumes rose year-on-year, with new managing general agents (MGAs) and insurers entering the market, despite some exits. Insurers expanded their appetite for diverse deal sizes, structures and geographies, while product innovation accelerated across warranty and indemnity (W&I)/representations and warranties (R&W), tax, insurance due diligence (IDD) and contingent risk solutions.
Volumes, pricing and retentions
Submission volumes increased by 17% year-on-year, with a 5% rise in average deal value. Insurers showed greater willingness to provide solutions across a wide range of deal sizes, from enterprise values below £/$/€5 million to multi-billion transactions. While premium rates began to stabilise after years of decline, retentions continued to trend downwards, with tipping-to-nil structures becoming more common. However, some clients opted for higher retention levels to align with their risk appetite.
Regional highlights
- UK and EEA: Transactional insurance remained a key tool in M&A, with a soft market driving historic lows in premiums and retentions. Gallagher's UK/EEA M&A team achieved a 32% increase in deal volume and an 80% rise in total deal value.
- United States: Liquidity challenges shaped the market, with GP-led continuation funds and secondary transactions becoming critical. Gallagher saw record R&W submissions, with rates increasing slightly to reflect the claims environment.
- Canada: Despite a slow start, the Canadian market saw growth in smaller transactions, particularly in the sub-$10m to $15m EV range. Tax insurance also gained traction, with Gallagher leading in Canadian tax placements.
- Asia-Pacific: The region showed resilience, with a 5% increase in M&A volume. India, South Korea and Japan led the way, while Australia saw a rise in cross-border M&A. W&I insurance premiums continued to decline, but competition among insurers remained high.
- Middle East: Deal volumes increased by 13%, with W&I insurance gaining traction. However, the evolving Middle East conflict introduced new geopolitical risks.
- Africa: Insurers expanded their appetite for African jurisdictions, with rates and retentions continuing to fall. Gallagher worked on transactions across multiple countries, including Uganda, Kenya and Nigeria.
Emerging trends
- Tax insurance: The market experienced significant growth, driven by increased demand for coverage of operational tax risks, cross-border transactions and tax credit insurance for clean energy projects.
- Contingent risk insurance (CRI): CRI gained momentum, particularly in restructuring and financing contexts, offering innovative solutions for managing transaction complexity and optimising balance sheets.
- Insurance due diligence (IDD): IDD played a critical role in helping deal teams identify risks, evaluate insurance programmes and support transaction execution.
Looking ahead to 2026
The outlook for 2026 is cautiously optimistic, with stabilising interest rates, ample investment capital and recovering valuations expected to support deal activity. However, the Middle East conflict and its impact on energy markets and supply chains may introduce additional volatility.
In the dynamic environment, M&A insurance will remain a vital tool for dealmakers, enabling them to navigate complexity, bridge valuation gaps and execute transactions with confidence.
2026 presents significant opportunities albeit in an increasingly unpredictable and fast-changing environment. Insurance solutions that mitigate and manage a wide range of risks can serve as a powerful catalyst to unlock transaction momentum.
