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Tax liability insurance provides coverage for a tax risk whereby an insurance company agrees to indemnify the insured for loss resulting from a challenge by a tax authority. Our market-leading Tax insurance Practice includes both tax lawyers and former tax insurance underwriters, allowing us to provide not only sound substantive advice but also an unparalleled insight into the underwriting community’s philosophy and appetite.
Tax insurance provides coverage for a tax risk whereby an insurance company agrees to indemnify the insured for loss resulting from a challenge by a tax authority. Our market-leading Tax insurance Practice includes both tax lawyers and former tax insurance underwriters, allowing us to provide not only sound substantive advice but also an unparalleled insight into the underwriting community’s philosophy and appetite. Lockton’s Tax Insurance Practice is one of the leaders in the field of sophisticated tax liability insurance. Lockton’s team of former tax attorneys uses strategic brokering to bring tax certainty to uncertain tax situations.
What is tax insurance? Tax insurance is a solution to transfer risk of a known potential tax liability from a company's balance sheet to an insurance company.
- Offers a financial guarantee for a position where there is at least a "more likely than not" level of comfort.
- May be a means to mitigate the financial statement of a FIN 48 (ASC 740-10) reserve.
- Can be used to replace or backstop an indemnity in transaction agreements for a specific tax risk.
- No costs are incurred until you agree to move forward with a policy.
What's covered with tax insurance?
Federal, state and local
Coverage could include loss of future use of tax attributes.
Interest & Penalties
Other than for criminal or fraudulent activity.
Gross-up
If the insurance proceeds are taxable.
Defense/ Contest costs
May include advance of taxes required to be paid or deposited with a tax authority prior to a final determination. Length of coverage is usually 7-10 years.
Tax Talks with Tax Expert John Rayis
Read the latest edition hereCommon Insurable Risks
Contact our Tax Insurance team
Daniel Berger
Managing Director, Head of Tax Insurance
dberger@lockton.com
+1 9173512598
John Rayis
Senior Strategic Advisor, Tax and Transaction Insurance
john.rayis@lockton.com
+1 9176981184
Drew Hermiller
Senior Vice President
drew.hermiller@lockton.com
+1 6146689960
Eileen Kuo
Senior Vice President
eileen.kuo@lockton.com
+1 2404763955
Audrey Bailey
Senior Vice President
abailey@lockton.com
+1 2817723268
Caroline Peters
Vice President
caroline.peters@lockton.com
+1 703 801 3271
Coryle Roberts
Associate
coryle.roberts@lockton.com
+1 321 759 3109
Owen Murray
Analyst
owen.murray@lockton.com
+1 914 552 6257