Surety Bond News

HB 1692 is a new law that was enacted in Missouri State relating to real estate appraisal management companies. The new legislation requires real estate appraisal management companies to acquire a $20,000 surety bond. HB 1692 states that additional particulars regarding the surety bond requirement will be established through regulations. The SFAA and AIA cooperated with the bill sponsors of HB 2152/SB 991, which if enacted would have required real estate appraisal management companies to attain a $250,000 surety bond in relation to registration. HB 1692 was the law and surety bond quantity settled on that was enacted.

The State of Florida introduced a new bill concerning specified commercial lines and their rate and form filing procedures. The new bill is named SB 2176 and excuses particular commercial lines from Florida’s rate and form filing requirements. Both surety and fidelity are included in the lines for notice to the insurance department that must be submitted within 30 days of the effective date of any modification (Use and File). Both burglary and theft are not included in the lines excused of the requirements.

The State of Arizona enacted new legislation relating to real property appraisal management companies. The new law, which is referred to as SB 1351, requires real property appraisal management companies to become registered and acquire a $20,000 surety bond. When SB 1351 was originally introduced, the surety bond quantity was $50,000.

Self-insured workers’ compensation plans are affected by a new bill in the State of Georgia. The new bill is named HB 1101 and boosts the minimum quantity of the security deposit required for self-insured workers’ compensation plans from $100,000 to $250,000. HB 1101 also requires the security to be active until every claim under the plan has been closed or if the self-insurer is inactive and all applicable statutes of limitation have expired. The previous legislation stated that the State Board of Workers’ Compensation established whether or not a deposit must stay in place.

SB 18 is a new law that was introduced in 2009 affecting North Carolina cemeteries; the law repealed the pre-need funeral surety bond. This law originated from the insolvencies of two cemeteries. The surety company was prepared to pay the claims of the individuals whose contracts were not fulfilled, but the quality of the cemeteries’ records did not suffice. The Cemetery Commission also understood that the surety bond was a forfeiture bond and that the surety had to submit the whole penal sum of the bond to the state regulators, who would then pay the claims. The court concluded that the surety on the bond had no legal responsibility. The cemetery had altered its ownership and corporate name while the name of the cemetery on the surety bond was never modified.

While SB 18 initially repealed the bond requirement, the law was amended in the Senate to grandfather operating cemeteries that had surety bonds, but asked new licensees to set up a trust fund. The SFAA and AIA addressed this law last year so that when it passed the Senate, the provision to revoke the bond had been canceled. SB 18 was heard and a consumer group was fruitless in modifying the law so that the surety would have to certify yearly that it would take responsibility for claims as they occurred. The new law was enacted without any surety bond repeal.