How to Get a Freight Broker�s License in California

Mar 2 Posted on

Who Needs a Trucking Broker�s License?

Freight brokers take care of the logistics of moving freight from one point to another. They serve as intermediaries between shippers who need to have freight moved and carriers who can do the moving.

They negotiate shipping fees with reliable carriers and track shipments from their starting point to their destination. Shippers rely on them for information about the status of their freight while it�s in transit.

California-based freight brokers are licensed by the federal government, not by the state. The Federal Motor Carrier Safety Administration (FMCSA) issues freight broker licenses, which are called operating authorities. FMCSA is part of the U.S. Department of Transportation (USDOT), which regulates interstate commerce in the country.

What Does the Licensing Process Involve?

To get the operating authority you�ll need to work as a freight broker in California, you�ll need to accomplish the following steps:

  1. Create a legal business entity in California, such as a sole proprietorship, partnership, LLC, or corporation. You’ll need to register your business with the California Secretary of State.
  2. Apply for a (USDOT) number from the U.S. Department of Transportation. You’ll need to enter this DOT number in the next step.
  3. Use the Unified Registration System to apply for an operating authority from FMCSA. You’ll need to enter your DOT number to access the system. Fulfill all FMCSA licensing requirements, including obtaining a $75,000 freight broker bond, providing proof of proper insurance coverage, and paying the license application fee.
  4. Name a process agent. This will be the person the court can serve papers to if you are sued in your role as a freight broker. You must have a process agent in every state in which you do business. Process agent information is submitted to the FMCSA using form BOC-3.
  5. Within 4-6 weeks you should have your operating authority from FMCSA.

Why is a Surety Bond Required?

FMCSA requires freight brokers to purchase a $75,000 bond known as a BMC-84 bond. Alternatively, you can set up a $75,000 trust fund, if you don�t mind typing up your cash and assets.

The bond serves as your guarantee to do business in a completely lawful and ethical manner. It also provides financial protection for shippers and carriers who could suffer a financial loss if you violate the terms of a contract with them.

How Does It Work?

The surety bond agreement is a legally binding contract. The three parties to the contract include the USDOT (the obligee), the freight broker (the principal ), and the company that underwrites and issues the bond (the surety).

As the obligee, the USDOT has set the required (penal) bond amount at $75,000 for all freight brokers. The surety assigns a premium rate for each applicant approved and investigates claims. But it�s the principal who has full legal responsibility for paying claims against the bond.

When a claim is filed and found by the surety to be valid, the surety typically will pay it right away rather than wait for the principal to come up with the funds. However, the principal is legally obligated to reimburse the surety.

Request a Quote for Your Surety Bond Needs Today

The annual premium for a freight broker�s bond is calculated by multiplying the bond�s penal amount by a premium rate established on a case-by-case basis by the surety. The surety bases the premium rate primarily on the principal�s personal credit score.

The premium rate is set by the surety based largely on the principal�s personal credit score. If your credit is very good, you�ll be assigned a premium rate in the range of about 1% to 3%.� If your credit is poor, you�ll pay a higher premium rate.

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Give us a call or request a quote for the BMC-84 bond you�ll need to become licensed as a freight broker in California.

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How to Get a Liquor License in Missouri

Mar 2 Posted on

Learn how to get a liquor license in Minnesota, and request a quote today from Single Source Insurance for the bond you need.

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Who Needs a Liquor License?

The Alcohol and Tobacco Control Division of the Missouri Department of Public Safety issues five main classes of retail liquor licenses in Missouri:

  • By Drink
  • Package
  • Temporary Retail
  • Other Retail
  • Secondary Retail

There are multiple license types within each of these categories, as well as licenses for wholesalers, manufacturers, solicitors, and wine direct shippers. Our primary concern here is with retail liquor licenses.

What Does the Licensing Process Involve?

The licensing process varies somewhat depending on the type of license needed. The licensing section of the Missouri ATC website lists all of the necessary documents, fees, and other requirements for obtaining each type of liquor license (both retail and others). In most cases, one of these requirements is the purchase of a Missouri liquor surety bond.

Why is a Surety Bond Required?

The specific bond you�ll need in order to get a retail liquor license in Missouri is the Intoxicating Liquor, Wine, and 5% Beer Tax corporate surety bond. The bond is your guarantee to abide by the laws and regulations governing the payment of sales taxes to the state.

How Does It Work?

Every surety bond agreement is a legally binding contract among three parties, which are the obligee, the principal, and the surety. In this case, the obligee is ATC, which requires the bond as protection against financial loss resulting from a licensee�s failure to remit sales taxes. The licensee is the principal who is required to purchase the bond, and the surety is the company that underwrites and issues the bond.

The obligee determines the required bond amount on a case-by-case basis, with a minimum of $1,000 and a maximum of $10,000, but never more than twice the principal�s monthly sales tax liability. This is the bond�s penal amount, which is the most that will be paid on a valid claim against the bond.

The principal has sole financial responsibility for paying claims, but it�s often the surety that pays the claim initially. This ensures that claims are paid promptly even if the principal needs a little time to gather the necessary funds. But an advance payment made by the surety on behalf of the principal doesn�t let the principal off the hook. The principal is legally obligated to reimburse the surety.

Request a Quote for Your Surety Bond Needs Today

The annual premium for a Missouri liquor license bond is a small percentage of the required bond amount. While the obligee determines the required bond amount, it�s the surety that sets the premium rate, also on a case-by-case basis. The primary factors the surety considers are the principal�s personal credit score and financial stability. If your credit and finances are good, you�ll probably be assigned a premium rate in the range of 1% to 3%. If you have poor credit, your premium rate will be substantially higher.

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We�re here to help you get the best possible rate on the surety bond you need to obtain a Missouri liquor license. Request an online quote or give us a call today!

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How to Get a Trucking Broker�s License in Georgia

Mar 2 Posted on

Who Needs a Trucking Broker�s License?

The terms �trucking broker� and �freight broker� are often used interchangeably. They both refer to people who handle the logistical aspects of moving freight from one part of the country to another. Their role is to play �matchmaker� between shippers who have freight and carriers who can move it.

Trucking brokers save shippers money by negotiating shipping fees with reputable, reliable carriers. They also track shipments from one point to the next and keep shippers informed of the status of their freight while it�s in transit.

Trucking brokers are licensed by the federal government, not by individual states. Licenses, which are called operating authorities, are issued by the Federal Motor Carrier Safety Administration (FMCSA). This is the part of the U.S. Department of Transportation (USDOT) that regulates interstate commerce.

What Does the Licensing Process Involve?

To obtain an operating authority to do business as a trucking broker in Georgia, you�ll need to accomplish the following:

  1. Create a legal business entity in Georgia. This can be a sole proprietorship, partnership, LLC, or corporation. You’ll need to register your business with the Georgia Department of Revenue.
  2. Obtain a (USDOT) numberfrom the U.S. Department of Transportation.
  3. Apply to the FMCSA for an operating authority through the Unified Registration System. You’ll need to enter your DOT number to access the system. Be sure to fulfill all of the FMCSA licensing requirements including purchasing a $75,000 freight broker bond, providing proof of the necessary insurance, and paying the license application fee.
  4. Designate a process agent. This is the person the court can serve papers to if you are sued in your capacity as a trucking broker.You must have a process agent in every state you do business in. Submit a completed form BOC-3 providing this information to the FMCSA.
  5. It takes 4-6 weeks for DOT toapprove and issue a new operating authority.

Why is a Surety Bond Required?

The $75,000 bond, known as a BMC-84 bond, is an alternative to establishing a $75,000 trust fund. Most brokers don�t want to do establish a trust fund because it ties up their cash and/or assets. The bond, however, provides financial protection for shippers and carriers who could suffer a loss if you fail to live up to the terms of a contract with them. The bond is your guarantee to conduct business in a completely lawful and ethical manner.

How Does It Work?

The surety bond agreement is a legally binding contract involving three parties. The USDOT is the obligee requiring the bond, the trucking broker is the principal required to purchase the bond, and the company that underwrites and issues the bond is the surety. Each party has specific rights and responsibilities.

The obligee has set the required bond amount (also known as the bond�s penal amount) at $75,000 and established the conduct that would be considered a violation. The surety sets the bond�s premium rate for each applicant approved, and investigates any claims to make sure they are valid. The principal bears full legal responsibility for paying claims against the bond.

When a claim is filed and the surety determines that it is valid, often times, the surety will pay it rather than waiting for the principal to do so. This gives the principal a little time to gather the funds to cover the claim. However, the principal is legally required to repay the surety for any such advance payments to claimants.

Request a Quote for Your Surety Bond Needs Today

The principal pays an annual bond premium that is only a small percentage of the bond�s full penal amount, which is the maximum amount that will be paid on a claim. The premium rate is set by the surety based largely on the principal�s personal credit score. Those with excellent credit will typically be assigned a premium rate of no more than 3%, but those with lesser credit will pay a higher rate.

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When you�re ready to apply for licensing as a trucking broker in Georgia, contact us or request a quote for the BMC-84 bond you need!

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How to Get a Trucking Broker�s License in Texas

Mar 2 Posted on

Who Needs a Trucking Broker�s License?

Trucking brokers, also known as freight brokers, play an important logistical role in the movement of freight throughout the country. They match shippers with motor carriers who can move their freight.

Shippers pay for this service because freight brokers save them money by negotiating shipping fees, selecting only reputable carriers, tracking the movement of freight, and keeping shippers updated on the status of their loads.

Anyone who wants to work as a trucking broker must be licensed by the Federal Motor Carrier Safety Administration (FMCSA). This is the part of the U.S. Department of Transportation that is responsible for regulating interstate commerce and enforcing safety rules.

What Does the Licensing Process Involve?

The steps in the licensing process are as follows:

  1. Establish a business entity in Texas. This can be a sole proprietorship, partnership, LLC, or corporation. Register it with the Office of the Texas Secretary of State.
  2. Obtain a US Department of Transportation (USDOT) number.
  3. Apply to the FMCSA for an operating authority (the official term for a broker’s license) through the Unified Registration System. You’ll need to enter your USDOT number and fulfill all of the FMCSA licensing requirements. These include obtaining a $75,000 freight broker bond, having the necessary insurance (cargo, bodily injury, and property damage coverages), and paying the license fee.
  4. Designate a process agent to whom court papers may be served in the event that you are sued in your capacity as a trucking broker.You must have a process agent in every state where you do business. Submit a completed form BOC-3 to the FMCSA.
  5. It takes 4-6 weeks for DOT to approve and issue a new operating authority.

Why is a Surety Bond Required?

Every trucking broker must establish a $75,000 trust fund or purchase a $75,000 surety bond as part of the process of obtaining the necessary operating authority. The advantage of choosing the surety bond option is that it doesn�t tie up your cash or assets. The specific bond for obtaining a trucking broker�s license is called a BMC-84 bond.

The purpose of the bond is to ensure that funds will be available to compensate the shipper or carrier if you fail to meet the terms of a contract or otherwise cause them to suffer a financial loss. Thus, the bond serves as the broker�s guarantee to operate in a completely lawful and ethical manner.

How Does It Work?

The surety bond agreement is a legally binding contract that entitles an injured party to file a claim against the trucking broker�s surety bond and be compensated for their loss. There are three parties in the agreement. These are the obligee that requires the bond (USDOT), the principal required to purchase the bond (the broker), and the surety that underwrites and issues the bond.

The obligee establishes the required bond amount ($75,000) and the conduct that would constitute a violation of the surety bond agreement. The surety determines what a given broker will pay for a bond, and the principal is legally obligated to pay all valid claims against the bond.

The surety will often pay a claim on behalf of the principal to give the principal time to gather the funds to cover the claim. The principal is legally obligated to reimburse the surety for any such advance claims payment. The terms of the surety bond agreement indemnify the surety against any legal responsibility for paying claims.

Request a Quote for Your Surety Bond Needs Today

The annual premium for any type of surety bond is a small percentage of the required bond amount, also known as the bond�s penal amount. This is the maximum amount that will be paid on a claim.

The surety bases the premium rate primarily on the principal�s personal credit score, though other factors may also be considered. The higher the principal�s credit score, the lower the premium rate and vice versa.

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Request an online quote today for the surety bond you need to obtain your operating authority as a trucking broker. Or, give us a call to discuss your bonding needs with one of our experienced surety bond professionals. We look forward to serving you.

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How to Get an HVAC License in Arizona

Feb 28 Posted on

Who Needs an HVAC License?

Arizona does not offer one comprehensive HVAC license. Instead, there are licenses in three separate disciplines involved in HVAC contracting, which include air conditioning, refrigeration, and solar work. There is no specific license related to heating. The following are the specific licenses you will need in regard to each discipline:

  • �L� category licenses are for contractors doing commercial work
  • �C� category licenses are appropriate for residential contractors.
  • �K� category licenses are for both commercial and residential air conditioning
  • �L-79� licenses are for Refrigeration with Solar

The requirements for the various license classifications are available on the Registrar of Contractors (ROC) website.

What Does the Licensing Process Involve?

The following are the complete steps to the HVAC licensing process in Arizona:

  1. Pass the required examinations.
  2. Submit to background checks.
  3. Form and register a legal entity. LLC’s and corporations are required to register with the Arizona Corporation Commission. Partnerships are required to register with the Arizona Secretary of State, and sole proprietors do not have to register in order to apply for a license.
  4. Obtain a contractor�s license bond in the amount required for the specific license classification and anticipated annual gross volume. For commercial specialty contractors, the required bond amount ranges from $2,500 to $50,000.
  5. Pay the applicable application fee and license fee. If you’re a residential contractor, you must also pay an assessment into the Registrar’s Residential Recovery Fund or post a $200,000 cash or surety bond.
  6. Complete the application and submit it to the Registrar�s office, along with a copy of a government-issued ID, required bonds and payments, and all supporting documents.

Why is a Surety Bond Required?

The required contractor�s license bond is a contractor�s guarantee to do business in compliance with all applicable laws, regulations, and industry standards. The bond protects the state and the public by providing funds to compensate parties who suffer a financial loss due to the contractor�s failure to abide by the terms of the surety bond agreement. An example of this would be defaulting on a contract.

How Does It Work?

If the contractor violates the terms of the license bond, any injured party has the right to file a claim against the bond. To resolve the matter quickly, the surety company may pay a valid claim upfront and then collect reimbursement from the contractor. Every surety bond agreement includes a clause that indemnifies the surety bond company and holds the bonded individual legally responsible for paying claims.

Request a Quote for Your Surety Bond Needs Today

The annual premium for any surety bond, including a contractor�s license bond, is calculated as a small percentage of the required bond amount. The required bond amount is established by the ROC, but the premium rate is set by the surety bond company. This is based largely on the contractor�s personal credit score, their personal financial strength, and their business�s financial strength. Contractors with great credit will pay a much lower premium rate than those with poor credit.

Get Bonded Today

Request an online quote or contact our team at Single Source Insurance to discuss the bond you need to work as a licensed HVAC contractor in Arizona.

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How to Get an HVAC License in Texas

Feb 28 Posted on

Who Needs an HVAC License?

Air conditioning and refrigeration contractors and technicians need to be properly licensed by the Texas Department of Licensing and Regulation (TDLR) in order to work legally within the state.

There are two license classes:

  • Class A licensees are allowed to work on units of any size.
  • Class Blicensees may work only on cooling systems of 25 tons and under, and heating systems of 1.5 million BTUs/hour and under.

Within each of these classes, there are three available endorsements:

  • Environmental air conditioning
  • Commercial Refrigeration
  • Process Cooling or Heating

You may have both a Class A and a Class B license, but only one endorsement per license is permitted.

What Does the Licensing Process Involve?

The specific licensing requirements vary somewhat depending on whether you�re applying for licensure as a contractor, a registered technician, or a certified technician. The key steps in the process include the following:

  1. Meet the experience requirements for the type of license you’re applying for. Have the person(s) who supervised your experience complete an Experience Verification Form. In certain cases, education may be substituted for experience.
  2. Complete the application and submit it with the completed Experience Verification Form. Submit it with the application fee to TDLR for approval of your eligibility to take the licensing exam.
  3. Pass the licensing exam and all other licensing requirements within one date of filing your license application.
  4. Once you�ve passed the licensing exam, purchase the required insurance and submit a Certificate of Insurance to TDLR.
  5. If you plan to do business in a municipality that requires bonding of contractors, you may need to obtain a surety bond. Check with any city, town, county, or other jurisdiction in which you will be working to see if a surety bond is required for HVAC contractors.

Why is a Surety Bond Required?

A surety bond serves as your guarantee to conduct business in a lawful and ethical manner. It provides protection for clients who might suffer a financial loss if you do substandard work, default on a contract, or otherwise violate the terms of the surety bond agreement.

How Does It Work?

Every surety bond agreement is a legal document that binds three different parties:

  • The obligee requiring the bond (the specific local governing body)
  • The principal (the HVAC contractor) required to purchase the bond
  • The surety (the company issuing the bond)

The obligee establishes the required amount of the bond (the penal amount), the laws, and the regulations the principal must abide by to avoid violating the surety bond agreement. Any party who suffers a financial loss due to a violation by the principal has the right to file a claim against the bond.

Typically, the surety will pay any valid claim upfront and then collect reimbursement from the principal. Every surety bond agreement includes an indemnification clause that gives the principal the sole legal responsibility for paying claims and holds the surety harmless.

Request a Quote for Your Surety Bond Needs Today

If you need a surety bond to work in a particular municipality, you�ll pay an annual premium that is a small percentage of the bond amount required in that jurisdiction. That percentage will be determined by the surety based largely on your personal credit score.

The higher your credit score is, the less risk the surety is assuming in underwriting your bond, and the better the premium rate you�ll be assigned. If your credit is great, you could pay as little as 1% to 3% of the required bond amount.

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If you need a surety bond to do HVAC work in your area of Texas, request an online quote or contact the team at Single Source Insurance today.

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How to Get an HVAC License in Virginia

Feb 28 Posted on

Who Needs an HVAC License?

Virginia�s Department of Professional and Occupational Regulation (DPOR) issues three different HVAC licenses, which include the categories of journeyman, master, and contractor. Within the contractor category, there are three license classes (A, B, and C) based on allowable project size and the total annual value of all projects, summarized below:

Class A

Class B

Class C

Maximum Project Size

No limit

$120,000

$10,000

Maximum Annual Total

No limit

$750,000

$150,000

Also note that there are different experiential and educational requirements for journeyman, master, and contractor licenses.

What Does the Licensing Process Involve?

In general, the following are the steps in Virginia�s process for licensing HVAC contractors (not journeymen or masters):

  1. Apply to DPOR for approval to take the required licensing exam.
  2. Take the required eight hours of training.
  3. Pass the three examinations required of all contractors. These are General, Law, and Advanced.
  4. Pass the applicable specialty exam.
  5. Complete the license application and attach exam scores and proof of experience (Five years for Class A, three years for Class B, and two years for Class C).
  6. Submit the completed application and supporting documents, along with payment for the application and license fees.

Although it�s not a DPOR requirement, several municipalities in Virginia require contractors (particularly residential contractors) to obtain a surety bond before doing any work within the jurisdiction.

Why is a Surety Bond Required?

Some Virginia cities and counties require surety bonds from HVAC contractors. This is to protect themselves and the public from financial losses due to the contractor�s illegal or unethical business actions.

How Does It Work?

A surety bond contract is a legally binding contract involving three parties:

  • The municipality (referred to as the obligee in the Surety Bond agreement) requires the purchase of the bond and sets the required bond amount.
  • The HVAC contractor (known as the principal) must purchase the bond and abide by all of its terms, which include operating in complete compliance with applicable state laws and local statutes.
  • The company that underwrites and issues the bond (called the surety) determines the premium rate the principal will pay.

Any violation of this agreement gives an injured party the right to file a claim against the surety bond and be compensated for their financial loss up to the full amount of the bond. It�s common for the surety to pay a claim upfront and then collect reimbursement from the principal. However, the legal responsibility for paying claims ultimately rests with the principal.

Request a Quote for Your Surety Bond Needs Today

The principal pays a small percentage of the required bond amount as the annual premium for a surety bond. The primary factor the surety considers in determining the premium rate for a given bond applicant is the individual�s personal credit score.

The principal�s credit score is a good predictor of the ability to reimburse the surety for any claims paid in advance on the principal�s behalf. The higher the credit score, the less risk to the surety, and the lower the premium rate. If your credit is good, your premium rate could be as low as 1%.

Get Bonded Today

Request an online quote or contact our team at Single Source Insurance to discuss the bond you�ll need to work as a licensed HVAC contractor in your part of Virginia.

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How to Get a Collection Agency License in Arizona

Feb 4 Posted on

Who Needs a Collection Agency License?

The Arizona Department of Financial Institutions (AZDFI) requires businesses and individuals to obtain a collection agency license in order to engage in any of the following activities:

  • Active debt buying (direct collections on accounts)
  • Passive debt buying(no direct collections)
  • First party debt collection
  • Judgement Recovery
  • Third party debt collection

What Does the Licensing Process Involve?

Although AZDFI regulates and oversees the debt collection industry within the state, it uses the National Mortgage Licensing System (NMLS) to process applications for new or renewal collection agency licenses. Here is an overview of the application process:

  1. Complete the Arizona Collection Agency application forms on NMLS. The Company form (MU1) is the form used to apply for a collection agency license. The Individual form (MU2) must be completed by the designated control person and submitted with the Company form. Branch licenses. Branch license applications cannot be submitted until the collection agency license has been approved.
  2. Gather any other documents that must be uploaded to NMLS along with the completed application form, such as financial statements.
  3. Obtain a surety bond from a surety company authorized to do business in Arizona. The amount of the bond is based on the collection agency’s gross annual income from business transacted in Arizona during the previous year. The minimum bond amount is $10,000 and the maximum is $35,000. Get Bonded Now
  4. Pay the required Arizona application fee (currently $1,500) fee. There is a separate license fee, but that is paid after the application has been approved.
  5. Submit the completed application, accompanying documents, and surety bond through NMLS for approval.

Why is a Surety Bond Required?

A collection agency bond guarantees that the bonded company or individual (referred to as the bond�s �principal�), will conduct business in compliance with all applicable laws and regulations, including the Fair Debt Collection Practices Act (FDCPA).

It also protects AZDFI (the bond�s �obligee�) and consumers against financial losses resulting from the fraudulent or otherwise unlawful or unethical business practices of the principal. The bond ensures that funds will be available to compensate any injured party that files a valid claim against the collection agency bond.

How Does It Work?

The terms of a surety bond identify the actions that would constitute a violation of the surety bond agreement, which is a legally binding contract between the bond�s obligee, principal, and surety (the company that underwrites and issues the bond). A violation that causes a financial loss gives the injured party the right to file a claim against the collection agency bond.

When a claim is filed, the surety will first make sure that it is a valid one. The principal is obligated by law to pay all valid claims, up to the full required (or penal) amount of the bond. Often, however, to ensure timely compensation of the claimant, the surety will pay the claim up front and then collect reimbursement from the principal. An indemnification cause in the surety bond agreement relieves the surety of any legal responsibility for paying claims, requiring the principal to repay the surety for any such advance payments.

Request a Quote for Your Surety Bond Needs Today

You�ll pay an annual premium that is a small percentage of the total required bond amount. The surety will assign you a premium rate based on your personal credit score and personal and business financials.

If your credit score is outstanding, you�ll pay the lowest possible premium rate, as low as 1%. You should still be able to obtain an Arizona collection agency bond even if your credit is not good, but you will likely pay a higher premium rate.

Get Bonded Today

Call today to discuss your bonding needs, or request an online quote for the bond you�ll need to obtain a new or renewal Arizona collection agency license.

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How to Get a Collection Agency License in Minnesota

Feb 4 Posted on

Who Needs a Collection Agency License?

To operate as a debt collector in Minnesota, you must be licensed by the Minnesota Department of Commerce. Agencies must be licensed, and individual debt collectors working for an agency must be registered. There is an exception for out-of-state agencies that collect debts incurred in another state by Minnesota residents if collection activities are conducted by phone, mail, e-mail, or fax only.

What Does the Licensing Process Involve?

While the Minnesota Department of Commerce regulates and oversees the debt collection industry in the state, Pulse Portal, a credentials management system, handles the processing of license applications. Pulse Portal makes it possible to apply for a new collection agency license or renew an expiring one entirely online. Here are the main steps in the process:

  1. Access PulsePortal and complete the application for a collection agency license. A separate application must be submitted by each branch of a collection agency. Certain supporting documents must be uploaded at the end of the application (or emailed to the Department of Commerce): A copy of the business name approval or Certificate of Assumed Name previously filed with the Minnesota Secretary of State; Disclosure of Owners, Officers, and Partners form; Financial Statement form
  2. Pay the initial registration fee (currently $1,000 for the agency and $500 for a branch location) and the small application fee.
  3. Use the State ID and PIN number from page 2 of the license to set up an account for your agency on PulsePortal. This account will enable you to submit registration applications for individual debt collectors. You have 30 days from approval of the agency license to get at least one Minnesota debt collector registered and affiliated with the agency, or the agency license can be canceled.
  4. Submit a Minnesota debt collection agency bond for each of the agency�s licensed locations in the state. A copy of the application confirmation page from PulsePortal must be submitted along with the bond. Get Bonded Now.

Why is a Surety Bond Required?

The collection agency bond protects the state and consumers against financial loss resulting from the agency�s unlawful or unethical debt collection practices. The bond is the agency�s guarantee to abide by all applicable laws and regulations.

How Does It Work?

The surety bond agreement is a legally binding contract that establishes the conduct required to remain in compliance with the law and avoid claims against the bond. Any violation gives the injured party the right to file a claim and be compensated up to the full required (or penal) amount of the bond. That amount is based on the agency�s revenues from Minnesota debtors during the previous calendar year, with a minimum bond amount of $40,000 and a maximum of $100,000.

If the surety company determines that a claim is valid, and the collection agency doesn�t pay it right away, the surety typically will pay it in advance on behalf of the agency. An indemnification clause in the surety bond agreement makes the collection agency solely responsible for paying claims and legally obligated to reimburse the surety company for such advance payments.

Request a Quote for Your Surety Bond Needs Today

The annual premium for a Minnesota collection agency bond is a small percentage of the required bond amount. The surety company decides what that percentage, the premium rate, will be based on the personal credit score of the agency�s owner(s) and both personal and business financials. Applicants with outstanding credit can pay as little as 1% of the required bond amount, while those with lesser credit could be assigned a higher premium rate.

Get Bonded Today

Look no farther for the collection agency bond you�ll need to obtain or renew your collection agency license. Request a quote online or call and speak with one of our expert surety agents today.

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