Underwriting and Claims Expertise
Issue: A target company was contemplating an internal reorganization in anticipation of a divestiture. This reorganization resulted in a potential tax liability issue that created an impasse as to who should bear that transactional risk.
Solution: With a deep understanding of complex tax exposures, AIG tailored a coverage solution that bridged the gap in negotiations and transferred a portion of the financial risk associated with the potential tax liability to AIG.
Benefit: The parties proceeded with the acquisition knowing they had some financial protection should the acquired business’s tax position be successfully challenged by the taxing authority.
Why is this important?
AIG’s proven experience and deep underwriting of tax liabilities helps clients secure the right coverages, allowing buyers and sellers to transfer some of the financial risk associated with certain tax risks that could otherwise hamper negotiations.