In investment matters the common use of the " bond of indemnity " is in case of a lost security. It is a form of guaranty protecting a corporation (firm or individual) in event of presentation at some future time of a security which had been lost by the owner and the corporation issuing the same had issued a new security in its stead. The usual way of obtaining such a " bond of indemnity is to apply to some " guaranty and indemnity company " which makes a business of furnishing such bonds upon satisfactory evidence that the security has been lost or destroyed. For this bond, which is really a form of insurance, a reasonable charge is made.

A " bond of indemnity " has many uses to secure one against loss in money matters, but one of the most common is as a protection for the employer against loss resulting from the handling of funds, securities, etc., by an employee; as the cashier or treasurer of a bank. Such a bond may be obtained by an executor or administrator of an estate when required by law.

All " bonds of indemnity " used formerly to be obtained by getting one or more private individuals to " go on his bond." This was almost always done as a distinct favour on the part of the signer, and generally against his better judgment; he receiving no pecuniary return for his risk, as a rule. It gradually became more and more difficult to get such bonds, and, naturally, the " insurance " feature entered into it, and properly organized companies have taken over most of this work.

Bond (payable) to Bearer. Either an ordinary coupon bond, or a registered (registered as to principle only and with coupons) bond which has been so registered that it is good in the hands of the bearer and may pass from hand to hand without transfer upon the registration books.