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California Underwritten Title Company $100,000 Bond
In accordance with the provisions of Section 12389 of the California Insurance Code, the Insurance Commissioner of the State of California mandates that any individual who submits an application for a license to operate an escrow firm also obtains this bond.
This surety bond‘s primary function is to assure that the license applicant will satisfy the duties outlined in the following clauses:
- The applicant for the license, together with all of its agents and employees, has committed to following the guidelines outlined in Chapter 1 of Part 6 of Division 2 of the California Insurance Code.
- The applicant for the license, as well as all of its agents and employees, has committed to adhering scrupulously to the regulations established by the Insurance Commissioner for the State of California.
- Will use any and all cash received for escrow services, and hand them over to the state of California.
In the event that the licensee breaches any of the terms of the license, the state will have a way to seek financial redress – thanks to the surety bond that was provided.
Who Is This Bond For?
The posting of a California Underwritten Title Company Bond or a cash deposit is now a requirement for California Underwritten title businesses that participate in the escrow industry or function as escrow agents.
Since California Assembly Bill 704 went into effect on July 1, 2016, it mandates that California Underwritten title businesses that participate in the escrow industry or function as escrow agents are now required to either post a California Underwritten Title Company Bond or a cash deposit.
Qualifications/Requirements
Applicant firms and those who need the $100,000 California Underwritten Title Company Bond are quickly authorized. This is due to the fact that neither a credit check nor an underwriter review is conducted. Your application may be taken over the phone if you want to do so. The yearly premium for the necessity of a surety bond in the amount of $100,000 is $500.
Applicants who need a surety bond in the amount of $100,000 will have to fill out and sign a brief application for the surety bond. After that, it will be sent to an underwriter so that they may evaluate it. A check of your credit history is a part of this examination. A premium of $500 per year is needed, and good credit is a precondition.
After receiving notification that your California Underwritten Title Company Bond has been approved and receiving payment for the premium, a surety company will promptly issue your bond to you. Keep in mind that when you submit your paperwork to the Department of Insurance, they will want to see the original papers.
Bond Amount
The bond payment varies depending on the applicant for the license. This will be determined by the applicant’s credit score for the license. The initial premium on a bond might be as little as one percent of the total bond amount if the applicant has great credit.
The total number of documents recorded and papers filed during the preceding calendar year will determine the total amount required for the surety bond. This requirement applies to all counties in which the underwritten title business is authorized to operate.
How It Works
The purpose of this bond is to safeguard the obligee in the event that the principal breaches any of the contractual duties that are mandated by the California Insurance Code. A claim may be submitted by the obligee in the event that the principal does to fulfill any of the bonded obligations that are mandated by the applicable laws, rules, and regulations. The surety will first determine whether or not the claim is legitimate. According to the terms of the bond arrangement, the principal is responsible for making repayment to the surety in the event that the surety pays out the claim.
Methods to Pay the Premium
On the anniversary of the day the bond was issued, the premium that is linked with your California Underwritten Title Company Bond will be renewed yearly.
You may save money by prepaying the surety bond amounts of $50,000 or $100,000 for up to three years instead of renewing them annually since this option is available to you.
The following information pertains to the prepayment option for premiums and the savings it offers:
- $50,000 California Underwritten Title Company Bond Requirement
- The price is reduced to $450 if it is paid in advance for two years, representing a savings of $50.
- The price is reduced to $650 if it is paid in advance for three years, representing a savings of $100.
- $100,000 California Underwritten Title Company Bond
- If paid in full for the next two years, the premium is reduced to $900, representing a $100 savings.
- If paid in full for three years in advance, the premium drops to $1300, representing a savings of $200.