Credit spreads for secured debt issuances are lower than for unsecured debt issuances, especially when a firm’s credit quality deteriorates, the economy slows, or average credit spreads widen. Yet healthy firms tend to be reluctant to issue secured debt when other forms of financing are available, as we demonstrate with an analysis of security issuance over time and in particular around the COVID-19 pandemic shock in the United States in early 2020. We find that for firms that are rated below-investment grade and that have few alternative sources of financing in difficult times, the likelihood of secured debt issuance is positively correlated with the premium associated with secured debt. It is uncorrelated for firms that are investment grade. This pattern of issue behavior is consistent with firms seeing unencumbered collateral as a form of insurance, to be used only in extremis.