Transactional risk insurers paid close to US$650 million in claims to Marsh clients in 2025, as global notifications rose 35% year on year, and a small number of high-severity losses drove the overwhelming majority of dollars paid, according to Marsh's Global Transactional Risk Insurance Claims Report 2026.
The figures represent one of the most active years on record for the product line, with 665 claim notifications recorded across 386 transactions - a 26% increase in the number of deals generating at least one claim compared with 2024.
The claims surge lands at a moment when the transactional risk market has already begun to reprice.
The global market reversed three years of declining rates in 2025, with primary R&W premiums rising across most regions. North America saw the most pronounced increase, with average primary layer rates rising 16% year on year, compared with a 14% decline in 2024. Asia recorded an 8% increase, against a 24% average decline the year before, according to Marsh's 2025 Global Transactional Risk Insurance Report.
The correction was driven by two converging forces: a sharp rise in M&A deal volume and the claims environment itself. Global M&A deal values reached nearly US$5 trillion in 2025 - a 37% increase -including 70 transactions exceeding US$10 billion, an 81% jump year on year. More business meant more policies, and more policies meant more claims.
However, even the repricing may not be enough. Euclid Transactional, one of the market's specialist underwriters, has noted that while aggregate premium rates rose in 2025, they remain below the levels most industry experts consider profitable and sustainable, with increasing severity of loss payments underscoring the need for meaningful and lasting upward rate movement.
Across all regions, breaches of financial statement representations and warranties accounted for more than half of total paid losses globally. Tax-related claims generated more notifications by volume but produced comparatively little in the way of payments. Financial statement breaches, by contrast, were typically first-party issues raised only after a quantifiable loss had emerged - and they tended to be severe.
The dynamic reflect how damages are calculated. Losses arising from financial statement misrepresentations are frequently assessed on a multi-of-earnings basis, meaning even modest misstatements can produce claims amplified many times over. In North America, almost two-thirds of total amounts paid in 2025 resulted from EBITDA multiple-based loss calculations.
Meanwhile, payments exceeding US$20 million, less than 8% of all claims paid globally, accounted for roughly 43% of the aggregate paid amount. WTW's parallel claims data confirmed the severity trend, with North American clients recovering over US$150 million in 2025 at an average resolved claim payment of approximately US$7.3 million, with the average recovery representing around 50% of applicable policy limits.
Marsh clients in North America received more than US$412 million in 2025, a 39% increase on 2024, despite a 9% year-on-year decrease in total notifications. Five individual payments each exceeded US$20 million and together accounted for more than a quarter of the region's total payout.
For the first time, the majority of paid amounts originated from claims reported more than a year after closing. Because seller indemnities typically expire within twelve months, R&W policies are increasingly the only mechanism through which buyers can recover losses discovered during the later stages of ownership.
The number of tax insurance policies placed by Marsh in North America increased 82% in 2025, while Europe's tax insurance policy count grew over 50% and insured limits more than doubled year on year.
The UK recorded the most dramatic increase of any region.
W&I claim notifications rose 150% to 88, with total payments exceeding US$105 million - several times the 2024 figure. The average payment-to-limit ratio on UK policies receiving payments rose to 36% in 2025, up from under 5% in 2022, a trajectory that will draw close attention from underwriters assessing whether current rate levels adequately reflect the exposure on policies placed in prior years.
Europe saw notifications nearly triple relative to 2023, reaching 240 claims across 152 transactions, though aggregate paid amounts fell 37% to US$46.9 million, with several substantial claims approaching resolution expected to move that figure in 2026.
Asia and the Pacific recorded more than US$80 million in payments, with a single US$76 million tax liability claim in Southeast Asia dominating the regional total.
The product has moved decisively from niche deal facilitation tool to mainstream risk transfer instrument. How insurers handle claims is now as commercially significant as how they price and place cover - and the 2025 data makes that case with some force.
