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  2. Insurance Terms Starting With F

Financial Institution Bond

What is a Financial Institution Bond?

A financial institution bond protects financial institutions, like banks and credit unions, from financial losses due to fraudulent or dishonest acts committed by employees or other insiders. These losses include employee dishonesty, forgery or alteration, and technical fraud. Formerly, this coverage was known as "banker's blanket bond." Reasons for obtaining a financial institution bond include protection against financial loss and meeting regulatory requirements. Financial institution bonds can vary significantly, so reviewing the policy is vital to ensure adequate protection.