Every answer and its explanation appears here once you have finished the path. Each one then links to the matching glossary entry, where the concept is set out in full with its worked example.
1. Why do fundamental warranties carry a limit often equal to the whole price, when operational warranties settle for a fraction?
Because the difference is one of nature and not of size: an operational breach means overpaying for something owned, a title defect means not owning it
No partial indemnity makes sense when the very object of the sale did not belong to the seller: the loss really can be the whole of what was paid, which no accounting breach ever produces. The frequency answer inverts the fact exactly, these breaches being rare and massive, and it is the same inversion that explains what happens to the retention. The one invoking the survival period confuses two consequences of one cause: duration and limit are both extended because the nature of the risk requires it, one does not follow from the other. And the idea of room left by negotiation gives the limit a commercial origin where it has a logical one.
Glossary entry · assurance-garantie-passif-rwi2. Wordings remove or sharply reduce the retention on fundamental warranties. Why is that coherent?
Because a retention exists to filter out the frequency of small breaches, and a title defect is not a frequency risk
A retention filters noise: it is designed so the insurer does not handle a stream of small accounting breaches. A title defect is rare and, when it occurs, massive, so a deductible designed for frequency filters nothing and merely removes a share of an indemnity that should be whole. The proportion answer is arithmetically true and misses the reason: a negligible retention would still be justifiable if it did something, and the point is that here it does nothing. The one invoking premium confuses the price of a risk with its structure. The one about time to reach the retention transposes an aggregation mechanism that has no place on a single breach.
Glossary entry · assurance-garantie-passif-rwi3. How does a title review differ from a tax or environmental review, and what does that change about the budget?
It is finite and documentary, therefore completable: it is the only field where "we looked at everything" creates full cover rather than cover in appearance
There is a determinate number of capital operations since incorporation and all of them can be examined, where in tax or environmental work one samples and stops for lack of time. That gives a title review a property no other has and which should decide the budget, its cost being small against what it secures. The answer thinking it fast and public describes part of the work and misses the rest: an unformalized nominee arrangement or a pre-emption right in forgotten articles appear in no registry. The one pointing to fraud mistakes the cause, these defects being problems of archaeology rather than dishonesty. And delegating verification of its own chain of title to the seller amounts to asking it to certify what it is warranting.
Glossary entry · norme-de-diligence4. An industrial buyer acquires a company for one specific plant and operating permit. A third party exercises a valid pre-emption right over the shares. Does the fundamental warranty, capped at a hundred percent of the price, protect it?
It compensates the price and not the purpose: the policy pays value, it does not deliver the company, and no limit changes that
A title defect is not always repaired with money: the buyer can lose the shares themselves or end up with a hostile minority holder it did not choose. For a buyer whose strategic reason was control of one determinate asset, a plant, a permit, a market position, a hundred percent of the price does not buy back the deal that failed. The answer equating limit with loss is that of an attentive reader of the limits schedule, and that is exactly where the module means to surprise them. What follows is to write down, before signing, that this risk is not transferable and must be dealt with in the structure or accepted knowingly.
Glossary entry · assurance-transaction-ma5. The module proposes three checks taking under an hour. The first is to read the survival period and the limit of the fundamental warranties separately. Why separately?
Because they sit in different clauses from those of the operational warranties, and one rarely reads both
The regime of fundamental warranties is written elsewhere than that of operational ones, and the failure is one of reading before it is one of law: you open the limits schedule, read a cap and a period, and believe you have read the ones that apply. The check costs a few minutes and covers two clauses, not one. The answers inventing stacked limits or different starting points describe structures that exist elsewhere and that the wording would say if it meant them; assuming them without reading is exactly the reflex the check corrects. As for keeping the more favorable figure where they conflict, that is telling yourself the contract instead of reading it.
Glossary entry · assurance-garantie-passif-rwi