What is a Lottery Bond?
A lottery bond, also known as a lotto bond, is a surety bond required by most states of individuals or businesses who operate lottery equipment, or sell lottery tickets to the public.
The bond serves as a guarantee that the bond holder will operate in accordance with state regulations for sellers of lottery tickets and operators of lottery equipment, and will do so honestly and fairly. It also guarantees that they will pay all due taxes to the state lottery upon sale of tickets.
Furthermore, when getting bonded in some states, businesses also pledge to comply with additional regulations. This could include providing informational gaming materials at their establishment, allocating and maintaining funds to pay prizes up to a specific amount, and notifying the relevant persons in the case of lottery machine malfunction as soon as possible.
Lottery bonds are meant to protect the public and the state from individuals who are dishonest, mishandle funds, do not pay the necessary taxes, tamper with lottery equipment or otherwise cause financial harm to customers.
Like all surety bonds, lottery bonds are a form of agreement between three sides:
- A principal - the individual selling tickets or operating lottery equipment
- An obligee - the Lottery Commission
- A surety - the guarantor of the bond
If the principal gives the obligee a legitimate reason to file a claim against their surety bond, the surety bond company has to address this issue and pay compensation to the obligee(s) for any financial harm they’ve suffered. In other words, the surety bond offers financial protection and compensation to obligees in cases of dishonest business practices.
The surety bond also includes an indemnity agreement, which obliges the principal to repay the surety in full if a claim is filed against their bond.
Questions about Lottery Bonds
Who needs to obtain a lottery bond?
Lottery bonds are necessary to all those who sell lottery tickets or operate lottery equipment. Most states require operators or sellers to obtain a surety bond, so make sure to check with your Department of Revenue Lottery Commission, Lottery Corporation, State Lottery Agency, or other respective institution for more details.
Are there different types of lottery bonds?
While these bonds may sometimes be called “lotto bonds” or “lottery machine bonds,” they are, in effect, the very same bonds.
There are differences in the amounts of the bonds, though, which vary from state to state.
How much does a lottery bond cost?
The cost of your lottery bond is a percentage of the total amount of the bond you need to obtain. Amounts for lottery bonds are determined on a state level by the relevant authorities.
In other words, there are rarely fixed amounts for lottery bonds, though most bond amounts are in the range between $3,000 and $20,000.
When determining the rate at which you can obtain your bond, sureties take into account a number of financial indicators and predictors, such as your personal credit score, personal finance history, and business financial statements.
Among these, credit score is the most important, which means that if you have a high credit score, you will most likely be offered a low rate on your bond. Applicants with high scores can expect a so-called standard market rate, between 1%-4% of the total amount of their bond.
You can get a free quote on your bond by submitting your surety bond application through the application link. As soon as we have processed your application we will provide you with a quote on your lottery bond, entirely free of charge and without any obligations attached.
Can I get a lottery bond with bad credit?
Applicants with a low or nonexistent credit score often have trouble getting bonded, since they are considered a higher risk. This means they are faced with difficulties in conducting business, which may even make it impossible for them to improve their standing.
We at Lance Surety Bonds have created our Bad Credit Surety Bonds program, in order to enable such applicants to get bonded. This is made possible by our long-term partnerships with A-rated and T-listed surety bond companies, which are among the best and most reliable companies in the whole country.
Naturally, rates under this program are slightly higher, in order to mitigate the increased risk that comes with bonding bad credit applicants. Applicants with damaged credit usually see rates ranging from 5%-15%.
Regardless of the credit type of our applicants, Lance Surety Bonds is dedicated to always finding the best and lowest rates for our clients, and enabling them to get their bond as quick as possible.
How do I get a lottery bond?
To get your lottery bond, you just need to apply online and submit a simple surety bond application form. Approvals for lottery bonds are fairly quick, so you can expect to get your free bond quote soon after your submission.
You can also call us at (877)-514-5146 anytime to ask our surety experts any additional questions you may have or request assistance with your application. We will be happy to help!
Lottery retailer license requirements and renewal
Along with your surety bond, which you must submit when you are applying for your lottery retailer license, you will also be asked to submit a number of documents and items such as those on the list below.
- Application form
- Name of corporation and business address
- Full name, social security number and other identifying information
- Store hours and liquor permit number (if applicable)
- A criminal background check
- A Lottery Electronic Fund Transfer (EFT) system form (if applicable)
- Application and licensing fees
Whether or not you will have to submit any of the above documents will depend on your state’s Department of Revenue or Lottery Corporation, so make sure to check with them when applying for your license.
Licenses are usually issued for a number of years, and you will typically be asked to submit a license renewal application each time your license runs out. Along with this you will have to submit a new surety bond, unless state regulations require you to post a continuous surety bond.
Find Your Surety Bond
ArkansasScholarship Lottery BondARKANSAS SCHOLARSHIP LOTTERY
ColoradoLottery/LottoDepartment of Revenue, Lottery Commission
ConnecticutLottery Sales AgentConnecticut Lottery Corporation
FloridaGame Promotion BondFlorida Department of Agriculture and Consumer Ser
FloridaGame Promotion BondCity Of Jacksonville, Environmental/Compliance Dep
FloridaLottery BondFlorida Lottery
Florida7-11 Preformance Bond7- Eleven Inc
GeorgiaLottery/Lotto RetailerGeorgia Lottery Corporation
Local GovernmentLicense / Game of ChanceCity of Jacksonville, Enviornmental /Compliance
MarylandLottery/LottoMaryland State Lottery Agency
MinnesotaLottery BondMinnesota State Lottery
MissouriLottery/LottoMissouri Lottery Commission
NebraskaNebraska Lottery RetailerNebraska Department of Revenu
NevadaGaming EstablishmentNevada Gaming Commission- Tax and License Division
New HampshireSTATE OF NEW HAMPSHIRE RACING AND CHAROTABLE GAMINState of New Hampshire, Racing and Charitable Gami
New HampshireSurety Bond for Game Operators in New HampshireRacing and Charitable Gaming Commission
New HampshireCharitable Gaming Commission Games of Chance BondState of New Hampshire Racing and Charotable Gamin
New HampshireManufacturer Pursuant to Chapter 287-E Bond (BingoNH Racing & Charitable Gaming Commission
New HampshireDaily and-or Weekly Sales Agent BondNew Hampshire Lottery Commission
New HampshireLucky 7 Bingo Ticket Seller BondNH Racing & Charitable Gaming Commission
New YorkGames of Chance BondNYS Department of State
North CarolinaEducation Lottery BondNorth Carolina Lottery Commission
North CarolinaEducation Lottery BondNorth Carolina Lottery Commission
OhioLottery Sales RetailerOhio Lottery Commission
OregonLottery Commission AgentOregon State Lottery Commission
OtherGame Promotion Surety BondCity of St. Marys
Other7-11 Preformance Bond7-Eleven, Inc.
PennsylvaniaLottery RetailerPennsylvania Lottery
South CarolinaBingo Revenue BondState of South Carolina
TennesseeLottery RetailerTennessee Education Lottery Corp.
TexasBingo Prize FeesTexas Lottery Commission
VirginiaLottery Retailer Surety BondState Lottery Department