Sell-Side Transaction Liability Private Enterprise (TLPE) Insurance
An insurance product designed to protect the Seller and Buyer in an M&A transaction for a breach of the Seller reps and warranties. TLPE is the only such program available for the sub $30M enterprise value sector.
M&A professionals worldwide are using an insurance policy known as Representation and Warranty (R&W) to transfer risk from the deal parties to an insurance company. This tool has become indispensable in more transactions than ever before, and yet, it has been unavailable to the vast number of M&A deals where the enterprise value is below $30M. That is until now. CFC Underwriting has launched TLPE, a Sell-side R&W policy exclusively for the underserved, “Main Street” market.
- TLPE provides cover for defense costs arising from the claim of an inaccuracy in a representation or warranty.
- Provides up to 100% of the enterprise value to pay indemnity to the buyer in the event of a breach.
- Locks in the return of sale proceeds and provides a clean exit as the indemnity exposure is covered.
- Expedites the sale by getting the indemnification issue “off the table”.
- Eases concerns about collecting on a Seller’s indemnification
- Buyer enjoys the benefits of R&W protection without the cost
- Preserves the relationship with the Seller. In the event the Seller is remaining with the company, the Buyer pursues the Seller’s insurer, and not the Seller personally in the event of a breach.
- Expedites the sale by getting the indemnification issue “off the table”
"“From our perspective, R&W is for Wall Street. We wanted TLPE to be for Main Street”"
Underwriting & Placement Process
(3 days from submission to binding)
- Complete, sign and date CFC TLPE application
- Provide latest annual and YTD financial statements (enables applicant to skip Q.6.13 on the application)
- Within 3 business days, proposal issued
- Policy Bound upon receipt of:
- Signed No Claim Declaration (embedded in proposed policy)
- Copy of signed purchase agreement
- Confirmation deal closed
- Payment of premium
Request a Quote
Latest TLPE Insights
TLPE Insurance – A Must-Have for Lower Middle Market M&A Transactions
If you’re involved in lower middle market M&A, you probably know that traditional, Buy-side Representations and Warranty (R&W) insurance is not available to cover most
The Biggest Danger to M&A Sellers – and How to Avoid it
I got a call earlier today… one that I wasn’t exactly happy to receive. But I feel like I should share the situation that I
Why – and When – M&A Buyers Should Secure Sell-Side Transactional Liability Insurance
Let me say this loud and clear right now: Every Buyer of a sub-$30M EV target should insist on a sell-side Representations and Warranty (R&W)
Breaking Down Your Transactional Liability Insurance Options: No Insurance, Traditional Buy-Side, and New Sell-Side
When looking at options to cover a M&A transaction in the past, we’ve always said that you could either use traditional Representations and Warranty (R&W)
TLPE Case Study: Buyer Uses TLPE to Win Auction on Desirable $13M Tech Company
For many years, it was standard practice for Sellers in M&A deals with leverage to insist that Buyers forgo escrows as part of the terms
Rep and Warranty Insurance Is a “Mature” Product
In the world of M&A, Representations and Warranty (R&W) coverage has become a go-to transaction insurance product. Many PE firms, for example, have made it