What is a license bond, and who needs one?

A license bond is a surety bond a state requires as a condition of licensure, guaranteeing that the licensee performs their duties faithfully. Public adjusters most often need one: Texas requires a bond of $10,000 or more, Florida requires $50,000, and Georgia requires $5,000. Some producers also need a bond, such as Illinois producers who place insurance with insurers they are not appointed with, who must maintain $2,500 or 5% of premiums brokered, up to $50,000.

A license bond is a surety bond an applicant must post as a condition of holding certain licenses, guaranteeing compliance with the license holder's obligations. In DC, public insurance adjusters must hold a $20,000 bond; managing general agents and reinsurance intermediaries must provide proof of a $100,000 bond and a $1,000,000 errors and omissions policy; and title insurance producers must file a certificate verifying $500,000 in E&O coverage, a $200,000 fidelity bond, and a $200,000 surety bond.

A license bond is a surety bond a regulator requires before an agency can hold or maintain a license. In Kansas, title insurance agencies that handle escrow, settlement, or closing must file a surety bond or an irrevocable letter of credit: $100,000 in counties of 40,001 or more population, $50,000 in counties of 20,001 to 40,000, and $25,000 in counties of 20,000 or less.

In Minnesota licensing, a license bond is a surety bond filed with the state to demonstrate financial responsibility as a condition of holding certain licenses. Resident and nonresident public adjusters must email an original $10,000 surety bond on the Commerce-approved form, and viatical settlement brokers must show financial responsibility through a surety bond or a $250,000 deposit; errors and omissions coverage of at least $250,000 does not satisfy that requirement.

A license bond is a surety bond a state requires before it will issue or keep certain licenses in force. In Mississippi insurance licensing, public adjusters must document a bond or letter of credit from a qualified financial institution in force for at least $50,000 to cover claims-handling losses. An errors and omissions policy of the same amount also satisfies the requirement, and the bond or policy must stay active to maintain or renew the license.

A license bond is a surety bond an agency requires before it will issue or maintain certain licenses. In New Mexico insurance licensing, public and independent adjusters must file a surety bond in the aggregate amount of $10,000 with the Office of Superintendent of Insurance; staff adjusters and insurance producers do not need one.

A license bond is a surety bond a licensee posts to guarantee financial responsibility, and Utah requires one or similar coverage for certain insurance licenses. Third-party administrators must submit documentation of an insurance policy or surety bond under Utah Code 31A-25-205, and insurer-appointed title producers must carry a fidelity bond or crime policy of at least $500,000 plus professional liability insurance. Managing general agent and reinsurance intermediary applications do not require a bond.

A license bond is a surety bond issued in favor of the state that protects consumers if a licensee fails to meet obligations. Wisconsin requires registered public adjusters to file an original surety bond of at least $20,000, executed by an insurer authorized to issue surety bonds in Wisconsin, before performing adjusting services. Intermediary producers themselves are not subject to this bond requirement, though life settlement brokers must show professional liability coverage of at least $1 million.