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Advantages of the Monoline Structure

Monoline bond insurers participate in financial guaranty insurance and related products only.

Our exclusive focus on serving the capital markets sets monoline insurance companies apart from traditional insurance providers. This focus has allowed us to develop financial guaranty policies that meet the unique needs of our customers. From underwriting to claims, every aspect of the monoline business is designed to accommodate the needs and expectations of the issuer and investor communities. Thus, there are key attributes of a monoline guaranty that differentiate the monoline enhancement from traditional forms of insurance:

  • Timeliness of payment — monoline insurance companies make debt service payments whenever an issuer is unable to do so. This is in contrast to multiline insurance companies which may require a lengthy and unpredictable claims submission and adjustment process
  • Experienced surveillance — securities that carry a monoline insurance guaranty are monitored to detect and remediate problems before they occur
  • Specialized reinsurance relationships — monoline insurers have relationships with monoline and multiline reinsurance companies that help them to effectively spread risk and ensure that capacity is available or new policies. Multiline insurance companies may not always have these reinsurance relationships in place.

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