Deal Point: A lender is considering a loan to a start-up. While it is inclined to make the loan and is willing to take the credit risk related to a start up enterprise, one of its key concerns is that the prospective borrower has clear title to certain intellectual property rights. The prospective borrower has made certain representations about these rights and has agreed to provide the lender with an indemnity supporting these representations. The lender seeks an indemnity to support these representations.

Transactional Insurance Solution: A Reps & Warranties Insurance policy is issued to insure the lender against any breaches of the representations concerning these specific intellectual property rights.