Remember 2021, when there were 613 special-purpose acquisition company initial public offerings (SPAC IPOs)? 1 Heady times, but times that didn't last.
This simple chart below tells the tale:
Date source: SPAC Research2 as of March 13, 2026
Here in 2026, it's clear the SPAC market is once again picking up momentum. Indeed, year to date, more than 55 SPAC IPOs have already closed their deals and are out looking for targets.
Axiomatically, this kind of momentum only makes sense and will continue if there's renewed interest from private companies to go public through a combination with a SPAC (aka de-SPAC).
Even with the new wave of better-governed SPACs, real legal exposure still exists when it comes to the de-SPAC process. Gallagher's 2026 Guide to D&O Insurance for De-SPAC Transactions can help.
Whether you're a SPAC sponsor, target company leader or board member, the 2026 Guide to D&O Insurance for De-SPAC Transactions provides a step-by-step roadmap for securing comprehensive D&O coverage, reducing risk and staying ahead in this complex environment.
The SPAC landscape: Signs of revival
As Yelena Dunaevsky pointed out in her 2025 SPAC review and 2026 forecast, after averaging roughly seven to eight SPAC IPOs per month in 2024, the market picked up to about 10 to 11 per month in 2025. By the end of 2025, the total number of closed SPAC IPOs had more than doubled compared to 2024. On the de-SPAC side, however, activity in 2025 was more muted, with only 43 transactions completed, down from 73 in 2024.
But, of course, as Yelena pointed out, context matters. Fewer SPAC IPOs in 2022-2024 naturally resulted in fewer vehicles reaching the de-SPAC stage in 2025. Importantly, more than 100 business combinations have been announced, suggesting a healthy pipeline in 2026.
It's exciting to see this next generation of SPACs — "SPAC 4.0" — take hold. These companies put more emphasis on due diligence, better governance practices and risk mitigation strategies.
Even with a more strategic approach, however, companies that go public through a de-SPAC business combination are still targets for litigation.
Update on the SPAC litigation environment
Our data shows that SPAC-related securities class actions usually happen within the first three years after the de-SPAC business combination; 91% of all SPAC-related merger and acquisition (M&A) suits filed from 2019 to 2025 named SPAC sponsors as defendants; and fiduciary duty suits in Delaware have also been on the rise. This litigation is a driving force behind SPACs making the Cayman Islands their home.3
Add to this litigation the fact that 2025 saw two of the largest SPAC-related settlements to date — $80 million for Grab Holdings Limited and $126.3 million for Alta Mesa Resources4 — and it's unsurprising that SPAC sponsors and directors are increasingly focused on risk mitigation strategies.
But putting aside these very substantial settlements, what is more troubling is that, over the past five years, SPACs have continued to face ongoing legal challenges with substantial settlements, many years after they closed on their business combination. According to Gallagher's Databox, at the end of 2025:
- Thirty-nine percent of SPAC-related securities class actions in federal court remain open, 54% were dismissed/withdrawn, and 59% settled, with total settlements reaching $694 million and the median settlement being $9.5 million.
- Twenty-seven percent of SPAC-related M&A lawsuits in Delaware Chancery Court remain open, 17% were dismissed/withdrawn, and 56% settled, with total settlements reaching $421 million with a median of $10 million.
That said, more companies that want to go public may choose the SPAC route in 2026 and beyond, particularly since the current presidential administration has made capital-markets-friendly appointments that could help revive the SPAC space.
Why Directors and Officers insurance is critical in 2026
Litigation surrounding de-SPAC transactions remains a serious risk and underscores the role Directors and Officers (D&O) insurance can play when it comes to protecting directors and officers in costly lawsuits.
Having the right broker who understands the nuances of coverage for de-SPAC transactions can make the difference between a well-protected leadership team and one left exposed to significant risk.
Key takeaways from the 2026 Guide
Gallagher's Guide to D&O Insurance for De-SPAC Transactions, 2026 Edition, outlines the steps that companies need to take to ensure their directors and officers are protected from the risks associated with SPAC business combinations.
The Guide provides a structured roadmap to navigating the insurance process, including:
- Preparation: Establishing an insurance strategy, assessing SPAC tail coverage and ensuring seamless integration of policies
- Launch: Conducting underwriting meetings, refining coverage limits and securing optimal policy terms
- Implementation: Binding public-company-ready D&O insurance before the first day of trading to avoid gaps
- Ongoing support: Board education, market updates and claims advocacy to manage post-merger risks effectively
More insights from the Guide include:
- Structuring D&O coverage to mitigate SPAC-related litigation risks
- International SPAC challenges
- Cyber risks and governance best practices
Get instant access to the 2026 Guide to D&O Insurance for De-SPAC Transactions for more insights.
Published April 2026
