Transaction Risk Policy Feature Checklist
What to confirm in a transaction risk policy — what's standard, what's often limited, and what to add if needed — plus the gap most often missed.
Pull out your R&W, tax, or contingent risk policy (or binder) and check the box next to each feature you can confirm it includes — anything unchecked is worth a quick conversation with your advisor.
Tick each feature you can confirm your policy includes — anything left unticked is a good question for your next policy review.
| Confirm? | Policy feature | What to confirm | Priority |
|---|---|---|---|
| Retention and Drop-Down | Retentions run about 0.5% to 0.6% of deal value on smaller deals — confirm when the retention drops. | Standard | |
| Materiality Scrape | Confirm the policy reads out materiality qualifiers when calculating loss, matching the purchase agreement. | Standard | |
| Knowledge Exclusion Wording | Confirm only actual knowledge of named deal-team members excludes a breach. | Standard | |
| Survival Periods | Confirm how long general, fundamental, and tax representations stay covered. | Standard | |
| Deal-Specific Exclusions | Issues found in diligence are usually excluded — review each one before binding. | Often limited | |
| Compliance With Laws Coverage | The most frequent claim type — confirm wage-and-hour or regulatory areas are not carved out. | Often limited | |
| Interim Breach | Breaches first known between signing and closing are often excluded. | Often limited | |
| Tax Insurance | Insures a specific tax position that the R&W policy excludes or limits. | If needed | |
| Contingent Risk / Adverse Judgment | Insures known litigation or contingent liabilities that R&W excludes. | If needed |
The gap most often missed in this coverage
The most commonly missed gap in this coverage is the known issue. An R&W policy excludes problems the deal team found in diligence or knew about before binding — often the very risks that worry a buyer most. Cover them with a special indemnity or escrow from the seller, or with a separate tax or contingent risk policy, and confirm the deal-specific exclusions before signing.
Send us the checklist and we'll review your transaction risk coverage line by line, then market it across multiple carriers that compete for your account.
Related: Transaction Risk Insurance · Transaction Risk Supplemental (apply) · All coverage checklists
Frequently asked questions
What should a transaction risk policy include?
Standard features to confirm in a transaction risk policy include Retention and Drop-Down, Materiality Scrape, Knowledge Exclusion Wording, Survival Periods. This checklist also flags the features that are often limited or sublimited and the ones to add if needed, with a plain-English note on each.
Is this checklist insurance advice?
No. It is a free educational tool to help you have a more informed conversation with a licensed professional. It affords no coverage and is not insurance, legal, or financial advice — only your actual policy language governs what is and isn't covered.
Can Cory Washington & Co. review my transaction risk coverage?
Yes. Share your checklist and we'll review your program line by line, market your account across multiple carriers, and explain the trade-offs in plain English. Cory Washington & Co. LLC is licensed in all 50 states.
This checklist is a free educational tool from Cory Washington & Co. to help you review your own coverage and have a more informed conversation with a licensed insurance professional. It is general information only — not insurance, legal, or financial advice, and not a recommendation to buy, change, or cancel any policy. Coverage terms, availability, limits, and requirements vary by policy, carrier, and state, and only the language in your actual policy governs what is and isn’t covered. Checking or leaving blank any item above does not indicate that you are adequately insured or under-insured. Using this checklist does not create a client, agency, or fiduciary relationship. Always consult a licensed professional about your specific situation.