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
Element used to adjust losses to reflect the incurred but not reported claim (IBNR) under the retrospective method of rating. ...
Death caused by a person without legal justification. Wrongful death may be the result of negligence, such as when a drunken driver hits and kills someone; or it may be intentional, as when ...
Insurance company incorporated according to the laws of the state in which a risk is located and the policy issued. The insurance company is domiciled in that state. ...
Circumstances that encourage the organization of pension plans by employers. For example, employer contributions are tax deductible as business expenses and not currently taxable income to ...
Written contract between an insured and an insurance company stating the obligations and responsibilities of each party. ...
Insurance policy that differs from the standard form. ...
Same as term Deviated Rate: rates used by a property and casualty insurance company that are different from that suggested by a rating bureau. An insurance company may use deviated rates ...
Actuary, appointed by the life insurance company, required by the national association of insurance commissioners (naic) under the naic: standard valuation law to provide an opinion as to ...
Type of pension in which benefits may vary depending on the investment performance of the pension plan assets. Contributions are made to fund a target benefit, such as 35% of compensation, ...
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