Definition - What does Forgery Insurance mean?
Forgery insurance is a policy that protects a person or a company from loss or damage caused by altered, forged, or faked financial instruments.
Forgery insurance is also known as alteration coverage, depositors’ forgery insurance, or forgery bond.
Insuranceopedia explains Forgery Insurance
A person or company that becomes a victim of a forged financial instrument, such as checks or bank drafts, can be held liable for thousands or millions of dollars. These parties can protect themselves from the risk through forgery insurance. In this case, the insurer would compensate the victim of a counterfeit check or an altered bank deposit for the loss incurred or could incur as a result of the forgery up to the policy limits.
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