Arch Insurance's New Direct U.S. Team for Transactional Liability
Arch Insurance North America has launched a direct U.S. transactional liability team focusing on representations and warranties, as well as tax coverage products. This strategic move into the market reflects a growing demand for direct underwriting capacity instead of relying solely on partner-based distribution channels.
Gallagher's transactional risk insights reveal that representations and warranties insurance (RWI) rates increased from 2.5% in Q4 2024 to 3.23% by the following year's end. Concurrently, submissions rose by 5% through 2025, as per Marsh's Global Transactional Risk Insurance Claims Report 2026, which showed insurers paid out nearly $650 million to Marsh clients, with most claims due to financial-statement representation breaches. These trends highlight the importance of direct underwriting connections for effective mergers and acquisitions (M&A), offering enhanced accountability and responsiveness compared to intermediary-based capacity placements.
With over 15 years in the transactional risk arena, Arch Insurance has traditionally operated through Managing General Agents (MGAs) and Managing General Underwriters (MGUs) across North America, Bermuda, and the UK. The new direct U.S. platform is intended to complement, not replace, these existing channels, catering to different transaction profiles. The direct team, marked by robust broker and legal ties, is dedicated to handling larger, complex transactions with timely underwriting judgment and strong claims commitment.
The team is led by William Carson, Senior Vice President of Transactional Risk, under the leadership of Chris Christon, Senior Vice President of Executive Assurance. Carson, who brings expertise from Everest, underscores the team’s commitment to quick and comprehensive underwriting services, noting the importance of being an agile partner that understands transaction complexities and stands by its claim commitments.
The U.S. R&W market remains highly competitive with major players like AIG, Beazley, Liberty Mutual, Allied World, and Berkshire Hathaway Specialty actively contending for business. Cooley's M&A group observes that even smaller deals attract over 20 quotations, a notable increase from the constrained capacity period in 2021. Yet, pricing discipline persists, evident from rate adjustments aligned with claims experience.
In the first half of 2026, the U.S. M&A deal value hit $1.2 trillion, nearly doubling the $603 billion recorded in the same period in 2025, despite a slight dip in overall deal volume, according to PwC. EY-Parthenon predicts an 8% rise in U.S. deal volume for transactions over $100 million, driven primarily by an expected 11% increase in corporate M&A, while private equity activity stabilizes after an initial slowdown.
In transactional risk insurance, the private equity sector’s dynamics are pivotal, with U.S. firms possessing nearly $1 trillion in uncommitted capital. Pressures to invest and achieve returns from mature funds have led to increased use of representations and warranties insurance to enable clean exits without prolonged escrow holdbacks. Cooley's M&A group notes a shift towards carriers underwriting alternative structures like GP-led secondaries and continuation vehicles, increasingly favored as sponsors seek liquidity alternatives to traditional sales.