Learn how to become licensed as a lottery retailer in Washington, and speak with an Single Source Insurance agent today about purchasing the lottery bond you’ll need.
How Can I Get Licensed as a Lottery Retailer?
Washington issues a lottery endorsement to a retailer�s business license rather than a separate lottery retailer license. If you�re opening a new business, you can obtain your business license and a lottery endorsement at the same time.
Steps in the Licensing Process
Business licenses are issued by the Washington Department of Revenue. Go to the (DOR) website to apply for a new business license. You will find links on the DOR site to the forms you will need to complete and submit to have a lottery endorsement. If you already have a business license, you can use those links as well, or you can access the necessary forms on the Washington Lottery website.
To get a lottery endorsement that will allow you to operate as a lottery retailer, you will need to authorize a background check and purchase a Washington lottery bond with a coverage amount of $3,500.
Why Is a Washington Lottery Bond Required?
A Washington lottery bond is a retailer�s pledge to abide by all state laws and Washington Lottery regulations. A violation that causes financial harm to the Washington Lottery (the �obligee� requiring the bond) or to the public can result in claims against the bond. The most common violations include failing to turn over lottery sales proceeds to the state and misappropriation of lottery funds. The bond ensures that the lottery retailer (the �principal�) responsible for the loss will compensate the injured party by paying the claim.
How Do Washington Lottery Bonds Work?
A Washington lottery bond is a legally binding contract between the obligee, the principal, and a third party�the bond�s guarantor (known as the �surety�). �Although the principal is legally obligated to pay the claims, the usual practice is a bit more complicated. The surety, having guaranteed the payment of claims, will investigate each claim received and verify its validity. Then, unless the principal pays the claim immediately, the surety will pay it to resolve the matter quickly.� The principal�s obligation then becomes an obligation to repay the surety. Failing to do so can result in the surety suing the principal to recover the claim amount.
How Much Does a Lottery Bond Cost?
The annual premium for a Washington lottery bond is determined through underwriting. The primary consideration is the risk the surety will be taking on in guaranteeing to pay claims on the principal�s behalf. That risk is twofold: (1) the risk of claims being filed against the bond, and (2) the risk that the principal wouldn�t repay the surety.
That risk is measured largely in terms of the principal�s personal credit score. A high credit score is a sign of low risk, which deserves a low premium rate, perhaps as low as 1%, which would make the principal�s annual premium for a $3,500 Washington lottery bond only $35. Conversely, a low credit score suggests a higher risk level, which warrants a higher premium rate.
Our surety bond professionals will get you the Washington lottery bond you need at a competitive rate.