When should a bondholder consider bonds insurance? | Blog
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10150 Ball Ground Hwy,
Ste 101,
Ball Ground, GA 30107

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Ball Ground, GA 30107

The Sanford Group Insurance Blog

When should a bondholder consider bonds insurance?

Did you know that you could buy bond insurance to protect your bonding situation? Many insurance companies in Ball Ground, GA, including The Sanford Group, offer ways bondholders can protect their investments from new risks and other situations. That also means there are many types of bond insurance. Each type depends on your needs and the type of business you’re conducting. So at what point should you consider buying bond insurance? Read on to find out!

You can buy it immediately.

Since there are so many reasons why a person may choose to buy bond insurance, there is really no specific time to acquire the policy. However, many insurance companies prefer bondholders to conduct thorough research and determine which bond insurance works for them and the limits required. You can also speak to an expert to help you. 

When your securities have underlying ratings

Ratings are critical for most bondholders as insurers only insure securities that have underlying ratings at the investment grade. The un-enhanced credit ratings should range between BBB and AAA.  Once you buy bond insurance, the issuer’s bond rating becomes obsolete and is no longer required. Instead, the insurer’s credit ratings will be applied. That also means that you do not have to encounter a lot of disruption if the issuer goes into default. Your insurance company should automatically take liability and make the interest and principal payments owed going forward.

If you want a higher credit rating

This type of insurance is most common among people who wish to get a higher credit rating on bonds to make them attractive to Ball Ground, GA investors. Having bond insurance provides peace of mind and security, so you can rely on your credit ratings when you have bigger projects to fund.

For all your insurance needs, questions, quotes, and new policy discussions feel free to contact The Sanford Group, and our dedicated team of professionals will be happy to help.

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