What does forgery or alteration coverage pay for?

Forgery or alteration coverage is designed to specifically protect against losses resulting from acts of forgery or the alteration of negotiable instruments like checks. This type of coverage typically applies when an outside party forges a signature or alters a check to illegally obtain funds, thereby affecting the insured party’s financial interests.

In this context, choosing the option related to losses caused by outside parties who forge or alter checks directly aligns with the purpose of forgery or alteration coverage. This type of insurance helps mitigate the financial impact of such fraudulent activities, offering crucial protection to businesses and individuals from the repercussions of forgery.

The other options pertain to different types of risks that are not addressed by forgery or alteration coverage. Losses from natural disasters involve property insurance, employee theft pertains to crime insurance, and data breaches are typically covered under cyber liability insurance. Each of these scenarios requires distinct forms of coverage, highlighting the specialized nature of forgery and alteration insurance in protecting against specific fraudulent actions.