New Mexico Changes License and Bond Rules for Insurance Adjusters
New Mexico has recently enacted changes to the licensing and bonding process for public and independent adjusters in the state.
Previously, public and independent adjusters had to obtain one type of license that involved providing a $10,000 New Mexico public adjuster bond or independent adjuster bond, respectively. With the new rules, such adjusters are now required to obtain a business license and to employ individual adjusters, who are licensed separately and have posted a $10,000 surety bond. The individual bond requirement is a condition for the licensing of the business entity as well.
You can find further details about the new requirements in the sections below.
The new licensing requirements
In 2017, with Senate Bill 88, New Mexico introduced licensing and bonding requirements for public and independent adjusters in the state. Applicants had to go through a single licensing process that entailed posting a $10,000 surety bond.
The New Mexico Office of the Superintendent of Insurance has recently adopted additional rules for the licensing of insurance professionals. Both public and independent adjusters now have to obtain a license for the business entity.
Separately, licensed adjuster businesses also need to hire individuals who are licensed as adjusters for the same type of adjusting activities. The bond requirement has been transferred to the individual licensees. They have to provide a $10,000 surety bond. However, a business entity that applies for a license also has to showcase that its individual adjusters are licensed and bonded appropriately.
The purpose of the bonding requirement is to guarantee that the licensed adjuster will pay any due damages to the state or to a harmed customer, in case the adjuster has violated applicable laws. Thus, the bond represents proof of financial responsibility of the adjuster applicant.
The licensing for individuals runs for two years. The expiration date is the end of the birthday month of the licensee. In order to renew their licenses, applicants have to pay applicable renewal fees, as well as meet the continuing education requirements set for the previous licensing period of two years.
How to get bonded
In order to obtain your New Mexico public adjuster bond or independent adjuster bond, you have to apply with a surety provider. You need to pay a small percentage of the required bond amount of $10,000. This is called the bond premium, and it represents your actual bond cost.
The bond premium is formulated on the basis of your financial strength. The most important factors include your personal credit score, as well as other finances and fixed and liquid assets. Applicants with stable profiles typically have to pay around 1% to 5% of the bond amount to get bonded. Thus, your premium can be as low as $100 to $500.
Do you need more details about the new bonding rules for New Mexico public and independent insurance adjusters? Don’t hesitate to get in touch with us by calling us at 877.514.5146.