LICENSE AND PERMIT BONDS
License and permit bonds, also known more simply as “license bonds” or “permit bonds”, are a certain type of commercial bonding. Government agencies require business owners in specific industries to purchase these bonds before they can be legally licensed. They defend consumers by assuring businesses adhere to laws and other regulations enforced by federal, state and local government agencies.
License and Permit Surety Bond Types
Many unique license and permit bond types exist, but the following are some of the most commonly requested:
- Appraisal Management Company (AMC) Bond – These bonds require that AMCs operate according to law.
- Auctioneer Bond – Auctioneers in many states have to purchase a surety bond before they can be legally licensed.
- Auto Dealer Bond – Every state but Delaware, Ohio and Vermont requires auto dealers to purchase some sort of surety bond insurance.
- Collection Agency Bond – Construction professionals in most states must purchase these bonds before they can be legally licensed to work.
- Contractor License Bond – In 2011, the VA began allowing veterans’ friends and family members to act as fiduciaries, which gave those closest to veterans the ability to retain control of their finances, estates and benefits without having to pay the hefty fees charged by fiduciaries who work for the court.
- DMEPOS Bond – Suppliers of durable medical equipment, prosthetics, orthotics and supplies must purchase a surety bond before they can be approved to bill Medicare.
- Energy Broker Bond – Individuals who use competitive rates to encourage clients to switch energy providers must provide a surety bond before they can be licensed as energy brokers in many states.
- Fishing License Bond – Businesses that sell fishing licenses must purchase a surety bond before being permitted to do so. Health Club Bond- health clubs purchase a surety bond to guarantee membership fee reimbursement in case they unexpectedly close.
- Hunting License Bond – Businesses that sell hunting licenses must purchase a surety bond before being permitted to do so.
- Insurance Broker Bond – To protect against predatory sales practices; government agencies require that insurance brokers purchase a surety bond.
- Medical Marijuana Bond – Medical marijuana dispensaries in some states have to file a surety bond with whatever government agency regulates them. Medicaid Bond- health care providers that bill Medicaid have to file bonds to ensure they’ll keep accurate records and handle funds appropriately.
- MMA Promoter Bond – Professional sports promoters who want to promote a specific MMA fighter or event must file a surety bond before they can be licensed in some states.
- Money Transmitter Bond – Money transmitters must purchase a surety bond before they can be licensed.
- Mortgage Broker Bond – A wide array of mortgage professionals – such as brokers, lenders, servicers and originators – must purchase a surety bond before they can be licensed to work in certain states.
- Notary Bond – Before individuals can become a notary public, they must purchase a surety bond.
- Outdoor Advertising Bond – Outdoor advertising companies that plan to install signs must purchase a surety bond before they can be legally licensed in some states.
- Payday Loan Bond – Payday loan companies must purchase a surety bond as a way to guarantee they’ll use fair lending practices when issuing loans.
- Patient Trust Bond – Nursing homes and other types of assisted living facilities must purchase surety bonds to guarantee that they’ll handle patients’ funds appropriately.
- Preneed Funeral Bond – Some states require funeral homes to purchase surety bonds to guarantee they’ll handle client funds appropriately.
- Private School Bond – Some private schools have to purchase surety bonds to provide students and their families with financial recourse if the school closes or gets shut down.
- Professional Employment Organization (PEO) Bond – PEOs in some states must purchase a surety bond as a way to reduce fraud and other instances of malpractice within the industry.
- Surplus Lines Broker Bond – Surplus lines brokers must purchase a surety bond before they can be licensed to work in some states.
- Telemarketing Bond– Government agencies require telemarketing companies to purchase a surety bond to guarantee they won’t harass consumers or break other industry laws.
- Title Agency Bond – government agencies require title agencies to purchase a surety bond as a way to reinforce industry regulations.
- Travel Agency Bond – Travel agents purchase surety bonds to guarantee they’ll handle client funds appropriately, such as forwarding client payments to the appropriate resort.
- Used Car Dealer Bond – In addition to regular auto dealer bonds, some states require a specific surety bond type for used vehicle dealers.
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