What is an Independent Adjuster Bond?
Those operating as an independent adjuster may be required to hold a license, depending on the state where they work. Part of the licensing process involves securing an independent adjuster bond, which is a form of security to safeguard the general public and the state licensing authority from bad business practices.
An independent adjuster bond is provided by a surety to the independent adjuster in need of the bond, also known as the principal. The state licensing authority requiring the bond is known as the obligee. This structure works in the same manner as other surety bonds for other professionals.
Should a claim be made against the independent adjuster bond, financial damages incurred are paid by the bond provider, but the independent adjuster repays the claim amount in full.
Who Needs to Obtain an Independent Adjuster Bond?
New Mexico, New York, and California are some states that require bonds for independent adjusters. The laws may vary for other states as well as for local municipalities. If you’re a public adjuster, the licensing requirements will expand even further. Check your state and local agency requirements for specific details.
How Do I Get an Independent Adjuster Bond?
If you are in the process of obtaining your license as an independent adjuster, you’ll also need to begin a bond application if required by your state. The process is straightforward, starting with a free quote for an independent adjuster bond which you can request online.
What Does an Independent Adjuster Bond Cost?
Independent adjusters do not have to pay the entire amount of the bond required, but are instead charged between one and five percent of the total bond amount. For example, a $10,000 independent adjuster bond with a two percent price costs $200.
Because an independent adjuster bond is a form of credit extended to the licensed adjuster, the price of the bond varies from one person to the next based on their credit history.
Can I Get an Independent Adjuster Bond with Bad Credit?
If you have had trouble managing your financial responsibilities in the past and have less than perfect credit, the surety agency that provides your bond will view you as a higher risk. To offset that risk, the percentage rate you pay for the price of an independent adjuster bond may be higher.