What Is a Georgia Surplus Lines Broker Bond?
If you want to launch a business as a surplus lines broker bond in Georgia, you have to comply with the state licensing requirements. Among them is obtaining a surplus lines broker bond.
As all other surety bonds, this bond protects your customers against potential illegal activities you may engage in as a professional in your field. Thus, it ensures your compliance with all relevant laws and regulations.
Your surplus lines broker bond is a contract between your business as the principal of the bond and two other entities. The Georgia Office of the Commissioner of Insurance is the obligee that requires the bonding, while the surety is the third party that provides you with the bond.
Questions about Surplus Lines Broker Bonds in Georgia
When is this surety bond required?
Surplus lines insurance brokers in Georgia that want to start their legal operations need to get licensed with the Georgia Office of the Commissioner of Insurance. Posting a $50,000 surety bond is one of the main licensing criteria that you have to meet. This is how you prove your suitability for the job. The bond ensures you will follow the Georgia Insurance Code and any other applicable laws.
What is the bond cost?
The bond amount that you have to obtain in order to get a Georgia surplus lines broker license is $50,000. The bond premium that you have to pay is a fraction of this amount. It is typically about 1%-5% of the bond amount if you can showcase strong finances.
What is the bond cost formation process like? Your surety bond cost is determined after a careful examination of your personal credit score, business finances, and liquidity and assets. By considering these factors, your surety assesses how risky it is to get you bonded. The smaller this perceived risk is, the cheaper your surety bond price will be.
|Surety bond name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Georgia surplus lines broker bond||$50,000||$375-$750||$500-$1,250||$1,250-$2,500||$2,500-$5,000|
How can I get bonded with bad credit?
Even if you are facing financial issues such as a low credit score, tax liens, bankruptcies, or civil judgements, you can get bonded with Lance Surety Bonds. We operate our exclusive Bad Credit Surety Bonds program for applicants like you.
As the bonding risk is increased, we offer bonding rates of about 5% to 10%. Nevertheless, our close partnerships with numerous A-rated, T-listed surety companies allows us to get you bonded at the best possible conditions.
How do I apply for my Georgia surplus lines broker bond?
Would you like to learn more about the bonding process and its intricacies? We’ve prepared an in-depth How to Get Bonded page that you can consult at any time.
Lance Surety Bonds’ specialists are here to help as well. For any queries, just call us at (877) 514-5146.
What if I get a claim against my bond?
Unlike insurance, your Georgia surplus lines broker bond protects your customers rather than your business. This means that if you transgress from your legal obligations, you can receive a claim against your bond.
Parties who have suffered damages due to your illegal or fraudulent actions can demand a compensation of up to $50,000, which is the maximum penal sum of your bond. The surety that got you bonded may take on the costs at first to ensure a fast payment. However, you need to reimburse it, as per the bond indemnity agreement.
Due to the nature of bond claims, they can lead to serious financial consequences for your business. Your best course of action is to avoid situations that can result in claims.