Chapter 8: EMEA: Notifications by Target Location and Claims Severity and Payment Trends

June 25, 2025 7 mins

Chapter 8: EMEA: Notifications by Target Location and Claims Severity and Payment Trends

Aon data and the Insurer survey offer insights into claims notifications and payments across Europe, highlighting trends and case studies from Aon's data.

Claims insights by jurisdiction

Aon’s data shows higher incidence of claims in France, Iberia, and the Nordics. The Insurer Survey shows higher incidence in UK & Ireland, Benelux, and Italy.

Key Takeaway: The data set is small but will become more reliable as more policies are placed and notifications received. Results may be indicative of the various appetites for business but demonstrate claims are being notified across Europe.

Figure 39 shows the claims notification rates on policies placed by Aon with targets located in different European regions alongside the Insurer Survey. The two data sets should be considered in aggregate rather than comparatively, as each participant in the M&A insurance market will see only part of the whole. Furthermore, some geographical markets are more mature than others as users of the W&I product. Given the lag between deals closing and claims being notified, this maturity will be reflected in the data. The Aon data comprises a reasonable data set. The Insurer Survey data set is relatively small and therefore should be treated as a data sample rather than being necessarily indicative of trends and may be skewed by the relevant insurers’ respective appetites for different jurisdictions.

As can be seen from Figure 39, the Aon and Insurer Survey data has differing results. Market characteristics will factor into the notifications seen, such as the relative maturity of the market (as commented above) and the respective proportion of PE vs. corporate acquirers. We see higher rates of notifications across France and Iberia; however, the Aon data notes a particularly high incidence of tax notifications in those jurisdictions, which may mean that the local tax regimes are influencing notification rates. As detailed elsewhere in this report, a high proportion of tax notifications does not always translate into high loss payouts. The Nordics also show a higher rate of notification, which reflects the number of policies placed in this region.

Figure 39
Notification Rates 2020–2024 by Target Region

Aon Data: Claim Frequency 2015–2024 on North American Tax Policies

Insurer Perspective: The Insurer Survey shows higher notification rates for Benelux, Italy, and the UK and Ireland, though saw notably fewer notifications in the Nordics and Iberia. As discussed previously, the data set from the Insurer Survey for jurisdictional breakdown of data was smaller than other parts of the survey, and it may be that the insurers who responded place fewer policies in the Nordics than the Aon team.

2025 Transaction Solutions Global Claims Study

EMEA: Breach Types and Trends

Learn More

Figure 40
Aon Data: Claims Settled By Policy Placement Region in 2024

Insurer Survey Results: Tax Claim Frequency 2015–Q3 2024

Insurer handling of claims continues to be a key differentiator for our clients. The Insurer Survey provided comments that between 2021 and Q3 2024, where a settlement was reached with the insured, 20% took less than 6 months, 20% took 6–12 months, 50% 12–18 months, and 10% 18–24 months. This is in keeping with our experience.

We also asked whether time frames to reach settlement had stayed the same or slightly decreased; 33% of the insurers surveyed thought they had slightly decreased, whereas 67% thought they had stayed the same. Where claims were denied, insurers commented that this was due to insureds failing to establish that the seller had breached an SPA warranty, or an exclusion applied.

Nordics Claim Success Story

M&A Perspective: The Swedish M&A market has shown remarkable resilience and growth, even in the face of global economic uncertainties. This is largely due to the robust regulatory framework, a strong economy, and the innovative spirit of Swedish businesses. The market continues to attract significant interest from both domestic and international investors, driven by opportunities in sectors such as technology, healthcare, and real estate.

Scenario: A real estate private equity firm (“Insured/Buyer”) acquired shares in a number of German property investment companies, which in turn held a portfolio of properties with over 1,000 commercial and residential leases. They purchased a W&I insurance policy from Aon’s Nordics broking team, which insured the German target business. Post-acquisition, the Buyer discovered a significant and previously undisclosed cash shortfall. After a rigorous investigation, the financial “black hole” was ultimately traced back to an inaccurate rent roll: a spreadsheet that listed rents across the property portfolio (“Rent Roll”).

Aon Claim: The claim submitted to insurers alleged that the sellers had breached the Rent Roll warranty that guaranteed that the net cold rent figure provided in the data room would not fall materially short of the figures provided. The Rent Roll was relied on to value the business and ultimately determined the purchase price. On the facts, establishing breach was relatively straightforward. Quantifying the claim and the loss that flowed from the breach, however, was extremely complicated. Insurers instructed numerous financial experts to ascertain the “true” financial impact of the sellers’ misinformation, as well as teams of lawyers on both sides. The Insured spent a significant portion of time correcting the records and attempted to create a unit-by-unit assessment of loss, which, in circumstances where there were missing tenants, proved almost impossible. The loss exercise was compounded by elements of German law that needed to be factored in, such as leases dating back to the 1980s with the right to rent in perpetuity, an inability to rent a vacated rental without first investing capex in it, limitations on raising rent, and loss of opportunity.

Result: After discussions with insurers, expertly steered by Aon, the Insured was able to reach a mutually agreeable commercial compromise and agreed to settle the claim for over €10m. The Insured could not have foreseen the undisclosed cash shortfall, which was indemnified by the W&I insurance policy. The existence of the policy saved the Insured significant time and costs of potential litigation against the sellers and is another example of the significant benefit of utilising insurance solutions in M&A transactions.
Spanish Claim Success Story

Tips for Claims Recovery: Claims success hinges on reviewing warranties thoroughly, detecting breaches accurately, and quantifying losses precisely. There is broad coverage available in the M&A market, and when claims are made successfully it highlights the value W&I provides to secure investment returns in transactions.

Scenario: A Spanish renewables company (“Insured/Buyer”) acquired shares in a Spanish company, which included several solar power projects (“Relevant Projects”). They purchased a W&I insurance policy from Aon’s Spanish broking team for the acquisition. Under Spanish regulations, the Buyer was entitled to set rates of return with respect to the Relevant Projects provided that there was no record of litigation by direct foreign shareholders or investors, or if there were, that waivers had been obtained from the Spanish government. Post-acquisition, the Buyer was notified by the Spanish authority that there was, in fact, a record of litigation by foreign shareholders or investors with respect to the Relevant Projects and that the Buyer was therefore only entitled to a reduced profitability rate for such projects.

Aon Claim: The Claim submitted to insurers alleged that the sellers had breached the warranty relating to the profitability/remuneration of the Relevant Projects, which stated that the Buyer was entitled to the increased warranted profitability rate and that the seller was not aware of litigation by foreign shareholders or investors and had not therefore obtained a waiver. The Buyer claimed the loss in profit between the warranted profitability rate and reduced profitability rate for the regulatory period. The Buyer was able to establish breach; however, quantification of loss was complicated, as the loss in profit included an element of future economic loss that required the prediction of future revenue.

Result: In consultation with the insurer, assisted by Aon, the parties agreed on an acceptable time frame to claim loss and a methodology for the projection of revenue. After collaborative discussion, the Insured was able to reach a mutually agreeable commercial compromise and settled the claim for approximately €5m. The Insured were pleased they had a W&I insurance policy to indemnify them against this undisclosed issue.