What is an Insurance Broker Surety Bond?
Insurance Broker Bonds are license and permit surety bonds ensure that brokers conduct themselves in accordance with all applicable laws and regulations, as well as properly account for premiums collected, protecting any individual or group who experiences any losses or damages on their behalf.
Examples of insurance broker wrongdoings can include collecting inflated or unnecessary premiums, misrepresentation of their services, policyholder manipulation and fraud.
Who needs an Insurance Broker Surety Bond?
Insurance Broker Surety Bonds are required by individuals and businesses seeking a license to sell insurance related products and policies.
Which states require Insurance Broker Bonds?
Pacific Surety proudly offers Insurance Adjuster Surety Bonds in the following states:
- California
- Delaware
- Georgia
- Idaho
- Illinois
- Kentucky
- Nevada
- North Carolina
- Oklahoma
- Rhode Island
- Vermont
- Washington
If you do not see your state listed, please contact us, and our knowledgeable underwriters will assist you.
What is the bond amount for Insurance Broker Surety Bonds?
Amounts for Insurance Broker Surety Bonds vary and are set by the local rules and statutes regulating the industry. Therefore, bond amounts and requirements will fluctuate from bond to bond. Please contact us with specific questions, and our knowledgeable underwriting staff will assist you.
How much do Insurance Broker Bonds cost?
Pricing for Insurance Broker Surety Bonds varies, and your premium will be based on the following factors:
- State the bond is required in
- Amount of the bond
- Term length of the bond
- Personal credit for all owners with at least a 10% ownership stake in the business
Individuals with good credit can expect to pay between 1%-5% of the bond amount. This means qualified applicants could pay as little as $100 annually for a $10,000 Insurance Broker Surety Bond. To find out how much your bond is going to cost, please complete our online application for your free, no obligation price quote.
Can I get this Surety Bond with bad credit?
Pacific Surety offers a wide range of approvals, regardless of credit, for Insurance Broker Surety Bonds. With our strong surety relationships, we have the ability to approve 99% of applicants, regardless of how bad their credit is. Our knowledgeable underwriting staff will work with you to ensure you receive the lowest possible pricing for your bond. Applicants with substandard credit can expect to pay 5%-10% of the bond amount in premium. To see what rate you will qualify for, please complete our online application for your free, no obligation price quote.
How are Insurance Broker Surety Bonds purchased?
The first step is to complete our quick online application for your free, no obligation bond quote. Submission takes only five minutes, and our underwriting staff will be in contact with you within a couple of hours with pricing. If you prefer to speak with our knowledgeable staff, please call 1-866-722-7873 and one of our Underwriters will assist you in applying for your bond.
After you receive approval, you must sign an indemnity agreement with the surety and provide payment for your bond premium. In most cases, we can issue bonds the same day we receive your signed documents and payment.
Who does An Insurance Broker Surety Bond protect?
Unlike insurance, which protects your business, Insurance Broker Surety Bonds protects your policy holders and clients. If the principal’s (insurance broker) actions cause any damage, a claim can be filed with the surety company for relief. If the claim is valid, the surety will pay up to the penal sum of the bond to resolve the claim. The principal is then required to reimburse the surety for all monies paid out, including any attorney fees incurred by the surety in the defense of the claim.
Claims can be detrimental to your business. Not only do they cause financial harm, they make it very difficult, if not impossible, to get bonded again.
What are the requirements for an Insurance Broker License?
The following are steps for becoming an insurance broker. License requirements vary for each specific state based on their insurance laws. Please consult your local authority for more specific information.
- Take pre-licensing classes and pass the licensing exam
- Obtain an insurance adjuster broker bond in the specified amount
- Fill out and submit all application forms to the licensing authority