Although an integral part of the deal landscape in established markets such as the US and Western Europe, insurance products have yet to take off in any big way in emerging markets. By far the main users of these services and products in emerging markets are the established, international players that are accustomed to sophisticated risk management techniques as a means of protecting their positions (and ultimately those of their limited partners).

“Insurance services during the transaction phase are mainly used by the large, international firms that are used to using them in markets such as the US and Europe and so apply the same techniques to emerging markets,” says Christoph von Lehmann, client director for Europe at Aon’s mergers & acquisitions group. “They’ll generally involve insurance services at the second or third round of the process.”

And as more international firms start dipping into emerging markets, the use of insurance products in these regions is starting to increase. “More Western firms are branching into new markets,” says Simon Dodsworth of Willis. “They tend to apply Western standards of risk profile to determine the levels of insurance required.”

Yet the local firms still haven’t bitten...

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