Rhode Island Surety Bonds Explained
People are often confused when they need to post a surety bond for the first time. Surety bonds are a regulatory requirement for many businesses and individuals. They are not the same as insurance, because they don’t protect the holder of the bond, but rather the state or the public.
Each surety bond agreement is a contract between three sides:
- A principal - required to obtain the bond
- An obligee - the side requiring the bond
- A surety - a bonding company underwriting the bond If a principal fails to abide by the rules of the bond agreement, they can face a claim either filed by the obligee or by another affected party. The surety and the principal are jointly responsible for paying the claim, though the final financial responsibility lies with the principal only.
If you’re ready to begin your application, you can find the bond you need in the table below. If you want to learn more about surety bonds in the state of Rhode Island, keep on reading for some useful information and tips.
Find Your Rhode Island Surety Bond
|Collection Agency Bond||Collection Agency||State of Rhode Island||Apply Now|
|Professional Fund Raisers Bond||Professional Fund Raisers||Dept of Business Regulation - Securities Div||Apply Now|
|Insurance Surplus Lines Brokers Bond||Surplus Lines Broker||General Treasurer of the State of Rhode Island||Apply Now|
|Mortgage Broker (1st & 2nd Mortgages) Bond||Loan Broker||Dept of Business Regulation, Division of Banking||Apply Now|
|Mortgage Lender/Banker (1st & 2nd Mort.) Bond||Mortgage Lender||Dept of Business Regulation, Division of Banking||Apply Now|
|Auto & Mobile Home Dealers (New & Used) Bond||Dealer's License||Division of Motor Vehicles - Dealer's License & Re||Apply Now|
|Auto & Mobile Home Dealers (Used Only, No New) Bond||Dealer's License||Division of Motor Vehicles - Dealer's License & Re||Apply Now|
|Health Spas/Health Clubs Bond||Health Club License||Attorney General Office||Apply Now|
|Detectives Bond||(Town of Cumberland) Detective Bond||Town of Cumberland||Apply Now|
|Employment Agencies Bond||Employee Leasing Company Bond||Dept. of Revenue, Div. of Taxation||Apply Now|
|Professional Licenses (All Other) Bond||Burglar Alarm Business Bond||Department of Labor and Training||Apply Now|
|Alcohol (Manufacturers, Warehouses, Wholesalers) Bond||Alcohol Beverage Bond||State of Rhode Island Dept. of Business Regulation||Apply Now|
|Telemarketing/Phone Solicitor Bond||Professional Solicitor or Fund Raising Counsel||Dept of Business Regulation||Apply Now|
|Telemarketing/Phone Solicitor Bond||Telemarketer Solicitation||Dept of Attorney General, Consumer Protection Unit||Apply Now|
Questions about Surety Bonds in Rhode Island
Who needs to post a surety bond in Rhode Island?
Most often, it is businesses which need to post surety bonds. Based on their intended purpose, surety bonds can be separated into three categories:
License or commercial bonds are the type of bonds required most often. Many businesses have to post them as an extra layer of protection for the state and their customers.
Contract bonds are only required for work on construction projects. There are several different types of bonds in this category. Broadly put, they protect the project from contractor default and breach of contract.
Court bonds are less frequently required. People appointed as guardians or fiduciaries are sometimes mandated to post them to make sure they act in the best interest of the parties they represent. Appellants may also be asked to post them.
How much does it cost to get bonded in Rhode Island?
You can quickly estimate the cost of getting bonded. First, you need to know exactly which surety bond you need to post, because each bond has a different total value required. This value refers to what a claimant can get if their claim is successful.
Principals only pay a certain percentage of that value, called a premium. It is surety bond companies who decide what your premium will be after a thorough evaluation of your application. The most important information they look for is your credit report. Applicants with good credit generally pay between 1% and 4% of the value of the bond.
Other factors, such as the applicant’s experience and financial strength, can also be considered. Get more cost-saving tips on our What Does a Surety Bond Cost? page.
Can I get a Rhode Island surety bond with bad credit?
Applicants with bad credit or no credit history are considered a higher risk by surety underwriters, which is why they sometimes can be denied a surety bond.
Lance Surety Bonds offers a bad credit surety bonds program with the purpose of helping such applicants post the required bond and remain in compliance. Premiums generally vary between 4% and 15%. If you take steps to improve your report, or strengthen your finances, you can expect decreasing premiums when you renew your surety bond.
How to get bonded in Rhode Island
The bonding process is simple. You need to submit an online application - this is a very secure and quick way to get your bond.
You will receive a free bond quote, and one of our agents will be in touch with you to help you finalize your application. Processing times vary for each bond, but we’ll do our best to get yours ready in as little as 2 business days. For any questions, do not hesitate to call us at (877)-514-5146 and we will happily help you.
Most Popular Surety Bonds in Rhode Island
The Dealer’s License & Regulation Office requires all dealers to post a $50,000 bond. The bond must coincide with the license period, and must expire on December 31st of any given year.
Also required by the Rhode Island Department of Business Regulation, this penal sum is slightly larger than that of the Loan Broker Bond. Mortgage Lender Bonds must be in the amount of $50,000, plus $5,000 per additional business location.
This is a $30,000 bond required by the RI Department of the Attorney General of all telephone solicitors operating in the state. The bond provides protection to consumers from violations by licensed phone solicitors.
A $50,000 surety bond is required from auctioneers, ensuring they comply with the provision of the Chapter 1499 Public Laws of 1956. A claim can be filed if an auctioneer doesn’t have an established place of business, or uses fraudulent business practices.
A $10,000 surety bond is required from professional fundraisers before they can obtain a license in Rhode Island. The bond protects against specific fraudulent acts, such as collection money on behalf of an organization without its consent, or falsely claiming collected money will go for charitable purposes.