Municipal Bond Insurance
Definition of "Municipal bond insurance"
Coverage that guarantees bond holders against default by a municipality. This form of financial guarantee was introduced in the early 1970s and became a runaway success. Municipalities embraced it because their offerings took on the credit rating of the company that wrote the insurance, rather than their own ratings. It meant that most municipal bond offerings were elevated to Triple-A, and municipalities could raise money at a lower rate of interest. For investors, it made municipal bonds less risky.
Popular Insurance Terms
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Right of an insured to make additional purchases of life insurance without having to take a physical examination or show other evidence of insurability. Additions can be bought at stated ...
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Statement issued by the insurance company denying a claim under the insurance policy on the grounds that a condition or policy provision has been breached. ...
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Agency that sells insurance policies from both a stock insurance company and a mutual insurance company. ...
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