Surety Bond News

A new secretary and treasurer bond requirement was introduced updating the stipulations in the state of Iowa on February 11th, 2009. The new law, titled HB 269, eradicates the surety bond requirement for the secretary and the treasurer of the board of a county or a memorial hospital. The previous piece of legislation required a surety bond to be acquired in accordance with the board’s qualifications. HB 269 was enacted on May 18th, 2009.

The state of Alabama enacted a new law on 05/21/2009 concerning the Boxing Commission. The new law, which is labeled SB 98, produces the Alabama Boxing Commission. SB 98 now requires promoters to be licensed and must acquire a performance bond in an amount and under the conditions that the commission will establish. Also, any individual boxing promoter is required to post a permit for every match and the Boxing Commission can ask for a performance bond with any permit as well as the license bond.

Mortgage brokers, bankers and industrial loan companies must follow new rule concerning bond requirements in the state of Iowa. The new law, HB 2556, raises the amount of the license bond amount required for mortgage bankers and mortgage brokers from $50,000 to $100,000. The law requires either a surety bond or collateral. HB 2556 also requires industrial loan companies to obtain a surety bond of $25,000 from a surety company licensed within the state. The law formerly required solely licensure. The surety companies are allowed to terminate the bond with 30 days of notice to the Superintendent of Banking. The surety bond is for the state’s utilization, including any individuals with a cause of action against the license applicant, and it is conditioned on the applicant’s truthful conformance to and abiding by the industrial loan company laws in addition to any policy adopted to implement it. The sureties will be required to reimburse the state and any individual all funds owing to the state and such individuals under the law. In place of the bond, alternative types of collateral may be posted; only if the collateral provides the same protections as the surety bond for both the state and clients.

On 03/11/2008, a new law relating to viatical settlements in the state of Iowa was introduced. The new law, SB 2392, permits the Insurance Commissioner to implement rules that oblige viatical settlement providers and brokers to post a surety bond or other financial responsibility. The bill initially would have adopted the NAIC model law, which demands proof of financial assurance by way of a $250,000 surety bond. SB 2392 was enacted on May 10th, 2008.

In Iowa, a new law was enacted concerning sanitary disposal project operators. The new law named SB 2276 increases the variety of financial assurance instruments that an operator of a sanitary disposal project can supply. The previous law required a surety bond, cash, or an irrevocable letter of credit. SB 2276 authorizes the operator to get hold of insurance, a corporate or a local government guarantee, or to suit a corporate financial test or a local government financial test. The project operator is also able to use a local government dedicated fund.