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Representations & Warranties

Home Representations & Warranties

Protects Against The Adverse Financial Consequences

Protects against the adverse financial consequences of a negative outcome arising from the warranties indemnities made by a seller to a buyer within a Sale and Purchase Agreement.

Coverable warranties and indemnities can include tax, environmental, litigation, contractual, financial, intellectual property and other matters where the outcome is uncertain, unknown or unknowable.

Who Buys It?
Why is the Product Purchased?
Who Buys It?

The Seller or the Buyer; typically prior to the sale of a company.

  • A Seller purchases the cover to protect their financial liability (including defence costs) where the buyer claims for breach of a warranty or under an indemnity
  • A Buyer purchases the cover to replace its’ recourse under contract against a seller for breach of a warranty or an indemnity

Why is the Product Purchased?
  • A seller may not be willing to give a financial guarantee (or one that the buyer considers adequate) – e.g. in a retirement sale
  • A seller may not have the financial ability to give a sufficient financial guarantee – e.g. in a bankruptcy sale
  • It may enable a transaction to take place that would otherwise fail because the potential risks to the parties are too great to be addressed in the sale price
  • A buyer may prefer to deal with the insurer, where a claim against the indemnity is necessary, than with a seller which has moved on. This is particularly true if considerable time has elapsed, or where legal action could put strain on continuing commercial relationships
  • Having an insurer assume complex risks may shorten the negotiation process

Call us today at  800.240.2448  or Email us at mail@chivaroli.com

Contact Us

Chivaroli and Associates Insurance Services is a full-service brokerage firm specializing in the custom-design and placement of insurance and alternative risk funding solutions for your healthcare organization.

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Address:
200 North Westlake Blvd., Suite 101
Westlake Village, CA 91362
Phone:
805-371-3680
E-mail:
mail@chivarolitr.wpengine.com

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