Three of the world’s largest insurance brokers have now independently documented what the Asia-Pacific warranty and indemnity (W&I) and tax liability insurance market has been signalling for several years: claims are accelerating in volume and severity at the same moment that premium rates have reached historic lows. That combination is the central tension now facing underwriters across the region.
Data from Aon, Marsh, and Gallagher, released across the first half of 2026, present a consistent picture of accelerating loss activity. Transactional risk insurance claim notifications across Asia-Pacific increased by 76% year-on-year in 2025, with Marsh clients receiving more than US$80 million in claims payments – the highest annual payout recorded in the region. Aon’s 2026 Global Transaction Solutions Claims Study separately documented more than US$26 million in claims recoveries for Asia-Pacific clients over the past three years, with several individual claims exceeding US$10 million.
Premium rates across Asia-Pacific declined for a fourth consecutive year in 2025, with Australia and New Zealand reaching a historical low of 0.88%, down from 1.09% in 2024, according to Gallagher’s Global M&A Insurance 2025 Review and 2026 Outlook report. W&I insurance pricing remained broadly stable through 2025 but is expected to firm modestly in 2026 as claims activity builds, driving more rigorous underwriting and broader coverage negotiations, according to Aon’s M&A and Transaction Solutions Insurance Market Insights for 2025-2026. The direction of travel is clear: a market that spent four years repricing downward is now absorbing a claims environment that did not exist when those rates were set.
India accounted for 33% of all transactional risk insurance claim notifications in Asia in 2025, with tax-related issues representing 50% of notifications in India and 92% of claim notifications originating from private equity-backed transactions, according to Marsh. Tax liability insurance claims across Asia-Pacific more than doubled compared to the previous year, largely due to rising regulatory and tax scrutiny across markets in the region, according to Marsh’s report.
The regulatory context for that doubling is concrete. India’s transfer pricing regime is undergoing wide-ranging change under the Income-tax Rules 2026, notified in March 2026, which introduce strengthened documentation requirements, block or multi-year transfer pricing audits, and a shift toward enhanced transparency and risk-based administration, according to Chambers and Partners. For insurers, tightening enforcement translates directly into longer audit cycles and, consequently, later-arriving claims – some not notified until more than five years after policy inception, according to Aon’s study. “We are seeing greater claims frequency and higher-severity outcomes, particularly in large and cross-border transactions. The region is also playing an increasingly important role in shaping global transaction risk trends,” said Martijn de Lange (pictured), managing director of Transaction Solutions in APAC for Aon.
Pricing began to show early signs of adjustment in certain segments as insurers responded to rising claims activity, with underwriting discipline increasing and pricing expected to become more differentiated in 2026, according to analysis from Program Business. In Australia and New Zealand, underwriters are navigating a market shaped by rising deal complexity, pressure on pricing, and a growing appetite for speed and certainty, with some underwriters cautioning that low retentions can dilute underwriting flexibility, particularly for complex, cross-border, or tax-heavy deals, according to Hong Kong Lawyer.
That tension is sharpest in Australia, the region’s most mature W&I market, where rates have reached record lows precisely as a new regulatory layer adds execution risk. From January 1, 2026, transactions implemented without formal notification or approval from the Australian Competition and Consumer Commission (ACCC) are automatically void, exposing parties to substantial legal and commercial risk, according to Gadens. Deal teams now carry a form of binary completion risk that did not exist before 2026 – and that W&I policies were not originally designed to address.
In 2025, Marsh Asia placed transactional risk insurance for a record 207 M&A deals across Asia, with Japan leading at 73 deals, ASEAN recording increased penetration of W&I insurance, and Greater China nearly doubling its transaction count from 2024, according to Marsh. Overall deal volumes across Asia-Pacific increased by 5% year-on-year in 2025, driven largely by activity in India, South Korea, and Japan, while cross-border transactions accounted for 61% of announced deal value in Australia, up from 49% previously, according to Gallagher. “As claims experience deepens across Asia-Pacific, clients are becoming more confident in pursuing recovery and leveraging these solutions as part of their deal strategy. At the same time, the growing prevalence of long-tail tax and regulatory exposures is contributing to a more complex risk landscape,” said Anita Vivekananda, managing director of Transaction Solutions in APAC for Aon.
The convergence of independent broker data on the same claims trends – rising frequency, increasing severity, tax-led loss drivers, and geographic expansion – provides the clearest market-level evidence yet that Asia-Pacific transaction risk insurance has entered a mature claims phase. Whether current premium structures are adequate for a loss environment where some of the largest claims arrive five or more years after a policy is written – underwritten at rates that have fallen for four consecutive years – is the question the market has not yet fully answered.
