Call Protection Law and Legal Definition

Call protection is a clause in a bond that prohibits the issuer from calling a bond for a specified period of time. For instance, if the first call on a bond is three years, a buyer will have three years of call protection, and they are assured that they can own the bond for at least three years.

Call Protection clauses usually require that an investor be paid a premium over and above the face value of the bond which is subject to early retirement following expiration of the period specified in the clause.

Call Protection is also called cushion.