Insurance Due Diligence Review, Imperative for Mergers & Aquisitions

A majority of today’s mergers and acquisitions come with hidden exposures and if not addressed can lead to catastrophic financial damage to the acquisition. In order to mitigate this concern, companies looking at acquisitions should engage an insurance consultant to review current exposures and coverage issues that influence the deal. The objective of engaging an insurance consultant is to initiate and manage the delivery of due diligence services, helping to coordinate the merger or acquisition for a private equity group, single corporate entity, or group basis. It is essential for the acquiring company to work with an insurance team that will uncover the unseen risks, costs, and potential liabilities of the new company’s insurance program.

The undertaking of a thorough due diligence review of a target company’s insurance and risk management program is an integral part of being successful in your acquisition. At Seitlin, our due diligence team will provide extensive research and analysis of the existing risk management programs in place that includes Property & Casualty, Employee Benefits, and Retirement Plans. Once the findings are completed, Seitlin will provide our client with a detailed Risk Assessment Report that summarizes the existing insurances in place, how accurately the coverage reflects the true risks associated with the target company, and any exposures not properly insured.

It is our goal to prepare our client making the acquisition and ensure their investment is safe and profitable if, and when, an exit is desired. Below we have identified a few key areas of focus to help uncover significant exposures and cost implications for the transaction.

• Identify uncovered liabilities and exposures that can be addressed by insurance products
• Complete Premium Comparisons and Forecasts – estimate the effect of the acquisition on future premiums
• Provide a forecast of estimated funded and unfunded long and short-term liabilities
• Identify potential areas of improvement for risk management policies and procedures
• Review of claims and loss history over the last five years – analyze trends in claims and make recommendations on how to improve

We are happy to discuss current and future opportunities to help position your company in the best way. Also, we can schedule an appointment to discuss the necessary items needed to complete our due diligence report.


For information regarding due diligence services for mergers and acquisitions, contact:

Jason Davis
Insurance Consultant
Tel: 305.717.6062
Cell:  305.401.6616
Email: jdavis@seitlin.com