Business Bond Insurance
Bond insurance offers a service under which bond issuers pay an insurance premium to someone who will provide the interest and payments in case the bond issuer cannot. This may raise the bond's rating to the level of the bond insurer. Many would want the bond insurer's credit rating to be somenwhat good. The premiums paid for bond insurance is an indication of the risk of failure for the insurance policy issuer.
Some government bonds are not insured, but the municipal bond insurance was created in 1971 and some municipal bonds are insured by a payment of a single insurance premium when the bond is purchased.Some of the major bond insurers include AMBAC, FGIC, AGC, ACA Financial Guaranty Corp, BHA, CIFG, Berkshire Hathaway Assurance, and MBIA Insurance Corporation.
