Consulting, brokerage and solutions firm Willis has launched Merger Protect, a specialized insurance product designed to help organizations manage the financial impact of US antitrust regulatory scrutiny during mergers and acquisitions.
The firm is launching the product as part of its wider transaction risk suite, designed to address the evolving challenges in the M&A space.
Willis explained that merger protection is intended to reimburse the FTC or DOJ for certain costs incurred when a second request is made under the Hart-Scott-Rodino Act and during any subsequent enforcement actions related thereto.
The company said the solution is designed to support buyers, sellers and their advisors through particularly demanding and resource-intensive stages of transaction execution.
Willis said a second request typically involves extensive data collection, documentation and detailed analysis, which can add time and cost. The company noted that costs associated with legal counsel, economists, e-discovery and document review could quickly add up, creating uncertainty about transaction costs.
“A second request does not mean a deal is broken, but it does create regulatory-deep financial uncertainty,” added Aartie Manansingh, head of alternative asset insurance solutions at Willis. “M&A protection offers transaction parties something unprecedented: a way to protect against fluctuations in the cost of regulatory scrutiny without compromising their ability to defend the deal. It is a meaningful addition to how sponsors and their advisors think about risk management in M&A.”
Willis said the policy is typically arranged early in a reportable transaction, before any regulatory requirements are issued. In the event of a second request, it will reimburse the covered response costs according to agreed terms, including applicable reservations and limitations, which may continue to apply if the matter proceeds to the enforcement stage.
Depending on how the policy is structured, eligible costs may include fees for outside legal counsel, consultants supporting the response, economists and industry experts, as well as expenses related to data collection, hosting, document review, production and witness preparation, the company added.
Willis suggested that by converting uncertain regulatory costs into certain insurance premiums, the product enables organizations to plan with greater clarity, protect transaction value and reduce unexpected financial stress. It can also help minimize operational disruption by covering the costs associated with preparing executives and key personnel so the team can continue to focus on closing the deal.
Willis further noted that its Litigation and Contingent Risk Solutions team works with clients to tailor coverage to the characteristics of each transaction, including size, industry and regulatory risk. The company emphasizes that the team combines specialized insurance expertise with insights into the antitrust review process and market developments, leveraging data on second request activity and enforcement trends to help structure appropriate coverage.
