What Does Representations and Warranties Insurance from CFC Cover?

CFC's Transaction Liability practice underwrites representations and warranties (R&W) insurance for M&A deals, available to both buyer-side and seller-side purchasers, alongside standalone small-deal products and secondary liquidity solutions. ¹Company-reportedTransaction liability product page overview, describing CFC as a deal facilitator working with private equity firms and strategic buyers and sellers.

CFC says it underwrites transaction liability business on behalf of Lloyd's of London syndicates and insurance companies rated 'A' or better by AM Best, without naming a specific carrier for any individual deal. ¹Company-reportedLimit & appetite section of the product page; the specific carrier for a given policy would appear on that policy's documents.

Beyond its main R&W policy, CFC sells two standalone small-deal products: Buyer Protect, described as covering a buyer for up to 100% of enterprise value, and Seller Protect, described as protecting sellers of small businesses during an M&A transaction. Both are limited to deals under $20 million. ¹Company-reportedProduct page descriptions and the 'Solutions' section, which caps buyer protect/seller protect at deals under $20m. The page's key-features bullets for these two products use near-identical wording about the buyer bringing a claim, so the exact difference in claims mechanics between the two products was not independently confirmable from this page alone.

The core transaction liability policy covers representations and warranties, contingent tax, and other M&A liabilities, and CFC also offers excess coverage layered on top for certain fundamental representations. ¹Company-reportedProduct page key features and the 'Limit & appetite' section; exact terms are set by the policy as issued.

CFC separately offers secondary liquidity solutions for private market investors acquiring, divesting, or restructuring interests in private equity, private credit, or other fund assets, through what it calls a dedicated secondaries underwriting practice. ¹Company-reportedSecondary liquidity solutions section of the product page.

CFC says it can underwrite up to $50 million of limit on a single transaction, or up to $150 million of excess coverage for certain fundamental representations. ¹Company-reportedLimit & appetite section of the product page.

For the Buyer Protect and Seller Protect products, CFC says coverage can be placed within 24 hours of receiving the application form, and can be arranged after closing. ¹Company-reportedBuyer protect and seller protect key features on the product page.

CFC has a dedicated transaction liability claims team in its London and New York offices, says it has handled nearly 300 claims to date, and aims to send an acknowledgement within 24 hours of a claim notification. ¹Company-reportedClaims section of the product page; outcome statistics are company-reported and not independently verified.