If you are an Illinois insurance producer who places insurance with an insurer with whom you do not have an agent contract, you are required to obtain an Illinois insurance producer bond.
The formula for determining the surety bond amount required is as follows:
It is at least $2,500;
5% of the premiums earned in the previous year;
WHICHEVER amount is GREATER;
BUT in any case not to exceed $50,000 surety bond.
The purpose of the Illinois insurance producer bond is to serve as a financial guarantee purchased by you on behalf of the people of the state of Illinois.
The bond, specifically, protects Illinois citizenry from acts of fraud, theft, criminal malfeasance or misfeasance, and violations of the Illinois Insurance Code committed by a licensed insurance agent.
The bond’s existence allows those who can credibly demonstrate financial harm to file against your bond, and have recovery up to the bond’s face amount (not per person, in total).
Along the same lines, however, your insurance producer bond is not an insurance policy which protects you.
And should a claim be paid on your surety bond, you would then be legally obligated to reimburse the surety for all fees and costs made in the satisfaction of your claim.
Premium amounts, of course, will vary based upon the dollar amount of the bond you are required to purchase.
Additionally, the application and your credit score will determine the amount of premium you are requested to pay.
Typically, this bond’s premium would be be between 1-5% of the face amount, with a minimum threshold of at least $100.
An applicant would good credit might pay $100 for a $10,000 insurance producer bond.
The same criteria for a $50,000 insurance producer bond would have a $500 premium payment.
Your premium amount, however, will be determined by the application --- and most substantially --- your credit score.
AmeriPro Surety Bonds is a surety bonds-only agency.
What this means for you is that surety bonds are our only focus.
Our agency provides license and permit, contractor, court, and fiduciary bonds throughout the great state of Illinois.
We also provide surety bonds nationwide.
We thank you for your consideration and look forward to speaking with you.