Business Insurance (05/25/12) Sheena Harrison
Although workers’ compensation reforms in California lowered medical costs by 30% from 2002 to 2005, the Workers Compensation Research Institute says medical costs per workers’ compensation claim edged up 8% annually from 2005 to 2009. The study blames a rise in the use of medical services, more claims with radiology costs, and an increase in a workers’ compensation fee schedule.
Buyers of a business generally expect sellers to be responsible for certain liabilities relating to when the seller owned its business—a concept mergers and acquisitions professionals refer to as indemnification. Indemnification is one of the most heavily negotiated, and potentially most significant, provisions of a purchase agreement, and understanding the terminology common to such agreements is essential when negotiating a deal. Attorney Paul Pincus of Ortoli Rosenstadt LLP explains what sellers are liable for, how a seller’s liability may be limited, and how buyers may seek to fund potential indemnity claims.
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