What does Blanket Bond mean?

Blanket Bond is a type of insurance which offers protection against disloyalty from the part of workers of certain financial institutions. It can also be found in other types of institutions like those whose primary occupation is brokerage or investments of all types.

Blanket Bond explained

Blanket Bond insurance covers for various reasons, thus it is a broad type of insurance. Most of the times it offers protection in case of theft, but also in case of major mistakes which might accidentally occur. Practically, a blanket bond works as an indirect safeguard for the investor as well, so that his investments will not suffer due to these situations. Restoring these types of financial losses is very important, and this is the primary goal of the blanket bonds. There are two basic types of blanket bonds: the commercial blanket bond with general coverage and there is the position blanket bond which offers specific coverage.