Snapshot
- In a competitive deal market, valuation is often where commercial ambition and claims reality meet.
- For senior dealmakers, lawyers and risk leaders, that makes valuation more than a pricing exercise. It is a critical part of how a transaction will be understood if a warranty and indemnity claim emerges later.
Insights shared during Aon’s recent M&A Claims Masterclass reinforced a clear theme: the more coherent the valuation story at signing, the easier it may be to assess loss, quantum and causation should a claim follow.
Valuation matters both at deal time, and of course, at claim time. First, it may help signal risk at the underwriting stage. When buyers pay elevated prices in highly competitive conditions, even small misalignments between the agreed price and the business’s underlying performance can drive larger and more severe claims. Second, at claim time, a cohesive story on valuation valuation – and clear contemporaneous documentation – may help create greater certainty by giving insurers and buyers a clearer basis for assessing breach, reliance, loss and quantum. Aon’s Claims Manager, Financial Specialties and Transaction Solutions, Ami Kalmath frames it simply. “Where a client is able to explain a clear and coherent valuation story, the claim process becomes easier to navigate. Where that narrative is fragmented, friction can follow,” she says.
For deal teams, the implication is practical. Claims are typically assessed by going back to what was known, relied upon, documented and agreed at signing or completion. As Kalmath notes, the claim process is “a forensic exercise”, which is why investment committee papers, the deal model, and the definitions used for earnings, net debt and working capital often become central evidence. In many cases, proving loss is not about inventing a new valuation framework after the event, it is about re-running the original deal logic with corrected inputs to test the gap between the business as warranted and the business as it actually was – correcting for the misrepresentation – at the transaction date.
That is also where many valuation disputes become more complex. Ankura’s Managing Director for Risk Advisory, Singapore, Alexander Stankovic, describes quantification as a sequence that must hold together “from the breach all the way through to the financial impact on the accounts, and from there draw the line through to valuation, and ultimately the purchase price”. Stankovic explains causation must be clear at every stage or the claim may quickly become harder to sustain. He also notes that the deal model remains the natural starting point, even if the facts later justify a more tailored approach. Thomas Burke, Transactional Risk Insurance Manager, Asia Pacific at Tokio Marine HCC, reinforces why that matters from an insurer perspective. “A claim may well face greater scrutiny if the valuation method used after completion departs too far from the approach adopted at signing. Where that model does vary, we want to understand why,” he says.
The lesson for senior transaction teams is that valuation should be treated as a core claims-readiness discipline, not simply a front-end negotiation issue. Clear documentation, aligned financial definitions, strong internal ownership of deal records and early engagement with specialist advisers may all help reduce delay and cost if a claim dispute arises. Adrienne Booth, Aon’s Executive Director, Transaction Solutions, New Zealand, puts it in practical terms: “It’s helpful to be thinking about this at the start as you’re going through the deal process, so you are considering what the quantum of any claim could be and the amount of cover you may need. For organisations active in deals, that discipline can make a material difference to both recovery outcomes and process efficiency.”
Explore further: For deeper insight into the latest claims trends, drivers of severity and practical implications for deal teams, explore Aon’s 2026 Transaction Solutions Global Claims Study.
