Surety Bond News

Texas debt management service providers must follow new surety legislation. The new law is titled SB 141 and requires debt management service providers to obtain a surety bond in a quantity equivalent to the average daily balance of the trust account holding funds for Texas consumers over a six-month period before the bond is issued. SB 141 states that the initial surety bond must be $50,000 if the provider doesn’t hold money paid by a consumer for distribution to creditors. The new law also requires the surety who writes the bond to be “A-” rated from a nationally known rating service.

South Dakota enacted a new bill concerning grain warehouseman. The new bill is named HB 1016 and declares that claims can only be made against a grain warehouseman or grain buyer’s bond if the individual informs the Public Utilities Commission, which must specify that it’s not taking an action against the surety bond.

In many cases small businesses and federal construction jobs mix like water and oil; they avoid each other. The government seems to gravitate to larger contractors as they have relative ease getting bonded in standard surety markets. The small contractors avoid the government funded SBA (Small Business Administration) Bond Guarantee Program, which is in place to help bond them, because of how cumbersome the SBA program is when compared to standard surety. Something has got to give. (more…)

Surplus line brokers are affected by revised surety law in Rhode Island. The new law is named SB 758/HB 5953 and modifies the surety bond requirements for surplus line brokers so that it pertains only to resident surplus line brokers.

The State of Oregon enacted a new bill affecting motor carriers. The new law is titled SB 259 and states that provisions in motor carrier transportation contracts requiring party or their surety or insurer to indemnify or hold harmless the other party against accountability for death, injury, or damaged property caused by negligence are invalid.