RWI
Law & Legal abbreviation · Contract
| Stands for | Representations and warranties insurance |
|---|---|
| Categories | Law & Legal |
RWI stands for Representations and warranties insurance, a contract abbreviation.
Insurance policy, usually bought by the buyer in an acquisition, that pays for losses caused by breaches of the seller's representations and warranties. It reduces or replaces the seller's indemnity obligations and escrow, making deals more attractive to sellers such as private equity funds.
Example: Because the buyer bound RWI, the seller's indemnity escrow dropped to half a percent of the price.
Usage notes
Also called R&W insurance, or warranty and indemnity (W&I) insurance outside the US. Policies have a retention, similar to a deductible, and exclude known issues, purchase price adjustments and certain risks such as underfunded pensions. It became common in US middle-market M&A during the 2010s.
Related abbreviations
More contract abbreviations
- PIIA – Proprietary information and inventions assignment agreement
- PSA – Purchase and sale agreement
- R&W – Representations and warranties
- RFP – Request for proposal
- ROFO – Right of first offer
- ROFR – Right of first refusal
- SAFE – Simple agreement for future equity
- SCCs – Standard contractual clauses
- SHA – Shareholders' agreement
- SLA – Service-level agreement
- SNDA – Subordination, non-disturbance and attornment agreement
- SOW – Statement of work
See all 57 contract abbreviations →
This entry is for general education and is not legal advice. Abbreviation use varies between institutions; always confirm in context.