Surety Bond Authority Weblog

New Hampshire’s SB 378 was recently enacted, which directed the State Supreme Court to create a dispute docket for business and commercial issues in the superior court. This new law has importance for the surety bond industry because all civil claims relating to surety bond issues will be assigned to and handled in this new dispute docket. As is the case with most state laws, this became effective at the time of enactment.

Now that HB 7985, SB 2743 and SB 2755 have been enacted in Rhode Island, state courts are given the discretion to waive the surety bond (fiduciary bond) requirement for a guardian of an estate, regardless of the monetary value of the estate in question. Prior to this enactment, previous state law mandated that a surety bond be obtained for any guardian of an estate valued in excess of $10,000.

With the recent enactment of HB 2315, Kansas now requires all home inspectors operating in the state to register with Kansas’ Home Inspectors Registration Board and to obtain a fidelity bond for no less than $10,000. Proof of the fidelity bond is required in order to cover any dishonesty.

Additionally, this new state law requires home inspectors to provide a separate submission to prove financial responsibility, which is this case can be in the form of a surety bond (license bond). The license surety bond must also be no less than $10,000, and cannot be terminated unless written notice is provided to the Board 30 days prior to requested termination. If the home inspectors are unable to obtain the license surety bond, for whatever reason, other acceptable forms of proving financial responsibility could include either an irrevocable letter or credit, an escrow account, or an errors and omissions insurance policy.

The recent credit crisis and major problems in the mortgage lending and real estate markets have brought about a number of new types of financial service providers. Subsequently, states are responding by attempting to create laws that require license bonds (surety bonds) for these new providers, such as foreclosure consultants, credit counselors, debt collection agencies, debt management services, and settlement servicers. Since most of this legislations was just recently introduced for the first time, it may take a year or two before the states are able to successfully enact these laws relating to license bonds.