HB 704 is a new law that was put in to place in the state of Louisiana regarding home service contract providers. The new law requires home service contract providers to supply a financial security deposit in a quantity equivalent to 5% of the gross consideration received on the sale of every service contract, less any claims paid. The deposit must be at least $25,000. Surety bonds, cash or securities are authorized to satisfy the requirement. In place of a security deposit, the service contract provider has the option to sustain a funded reserve account.
Eric is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog.