lost instrument bond
Quick Summary
A lost instrument bond is a type of insurance that protects against financial loss if a lost financial instrument, such as a stock certificate or money order, falls into the wrong hands and causes harm to the issuer of a replacement. This bond guarantees reimbursement for such losses.1
This differs from a forgery bond, which specifically covers losses from the forgery or alteration of negotiable instruments or evidence of debt or ownership. Both are types of surety bonds, which protect businesses against employee dishonesty or failure to perform agreed-upon work, involving three parties: the principal, the obligee, and the surety.21
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