A guarantee by a bond insurer of the payment of the principal of and interest on municipal bonds as they become due should the issuer fail to make required payments.  Bond insurance typically is acquired in conjunction with a new issue of municipal securities, although insurance also is available for outstanding bonds trading in the secondary market.  In the case of insurance obtained at the time of issuance, the issuer of the policy typically is provided extensive rights under the bond contract to control remedies in the event of a default.  See:  BOND INSURER; CREDIT ENHANCEMENT; CREDIT FACILITY; SECONDARY INSURANCE; SURETY BOND.

Insurance cover which a licensed insolvency practitioner must hold to cover the value of the assets of an insolvent individual or company which are under his control.

A legal and binding commitment by an insurance company that guarantees the timely payment of scheduled principal and interest in the event of a default by the issuer.