Forgery or Alteration

Coverage form B promises to pay for loss involving "covered instruments" resulting from forgery or alteration of, on, or in any covered instrument. A "covered instrument" is a check, draft, promissory note, or similar written promise or an order or direction to pay a certain sum in money that is:

1. drawn by or upon the insured; or
2. made or drawn by a person acting as the insured’s agent; or
3. that is supposed to have been so made or drawn.

Certain legal expenses are covered. If the insured is sued for refusing to pay any "covered instrument" on the basis that it has been forged or altered, the insurer will pay for reasonable legal expenses that the insured incurs and pays in the defense. In order to be indemnified, the insured must obtain written consent from the insurer to defend an action. This extension is in addition to the limit of insurance applicable to forgery or alteration coverage.