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Insurance risk management
Assessing insurance risk management costs and issues which materially impact your deal
Insurable risks such as Workers Compensation and Products Liability, insured or not, affect the immediate and prospective economics of a transaction. Buyers need to evaluate an acquisition target for adequate self-insurance reserves and properly expensed insurance risk costs, as well as assess coverage adequacy and the impact on the buyer's insurance programs in terms of change-in-control, insurance program structure, collateral and adequacy. As part of buy-side due diligence, PwC’s Transaction services insurance risk management advisors help clients by concentrating on the economic impact of insurance risk on the transaction by zeroing in on:
- how insurable risks affect quality of earnings, balance sheet, debt, collateral and run rate
- opportunities to reduce operating expenses and free up capital post-close
- M&A tax due diligence
- Human resources due diligence
- Commercial due diligence
- IT/Operations due diligence
Of further interest
- Webcast: Hidden insurance-related issues that impact deal value
- New M&A insurance risk for buyers: Medicare-related settlement clawback
- Collateral damage: Hidden deal breakers in insurance
- TS insights: Proactive insurance risk management at private equity portfolio companies adds value to the bottom line