The Marsh Pacific team worked on a record number of mergers and acquisitions last year as activity increased after a slow start and demand rose for warranty and indemnity insurance.

The number of deals grew to 40 from 31 the previous year and the number of policies placed by Marsh jumped 71% to 134, an annual report shows.

Marsh says uptake of warranty and indemnity (W&I) cover surged for small deals below $US50 million ($78 million) and “very large” ones above $US1 billion ($1.6 billion), which have historically faced cost-related challenges. 

“These challenges have been mitigated through increased competition and a more insured-friendly W&I market in the Pacific region,” the report says. 

Rates continued to decrease, reflecting competition among insurers driven by new entrants and aggressive pricing strategies.

Technology deals accounted for 18% of the Marsh-supported transactions, up from just 3.3% the year before and aligning with expectations for increased M&A activity in the sector.

Renewables and infrastructure – particularly digital infrastructure – also recorded higher deal volumes.

Claims notifications increased 50%, with misstatement of accounts continuing to be a major concern in transactions.

Marsh says the claims surge suggests growing awareness and confidence in the product as an effective risk management tool for transactions, and may indicate heightened vigilance among insureds in identifying breaches.

Clustering of claims may suggest systemic issues within certain target businesses.

“We anticipate M&A activity will continue building on the momentum gained in the second half of 2024, ultimately leading to a strong year for deal-making in the region,” the report says.

“Private equity, in particular, has abundant available capital for investment and there is increasing pressure among investors to deploy available cash effectively.”