What is an Illinois Third Party Administrator Bond?

Get to know what this surety bond is for and how to obtain one fast efficiently!

Illinois Third Party Administrator BondA surety bond is required before the issuance of a third party administrator license. It will serve a purpose in assuming liability for the failure in duty of the Principal or the licensed third party administrator through a bond claim.

Under the conditions of the surety bond, the third party administrator must comply with the provisions of the Illinois Insurance Code that is specific to his or her profession.

This includes, but is not limited to, the following:

  • Settles claims relating to life, accident, or health benefits
  • Collects premiums on behalf of an insurer or plan sponsor
  • Pay the number of transactions owed to a company that owns the monies that comes into the possession of the third party administrator

 

What is the Third Party Administrator Bond amount?

Third party administrators who maintain a Claims Administration Services Account (CASA)

  • $50,000 up to $1,000,000
  • The bond amount should be 5% of the projected claims and claims expenses to be held in the CASA for the payment of the claims and claims expenses of Illinois residents for the upcoming year

Third party administrators who maintain an Administrator Trust Fund (ATF)

  • $50,000 up to $1,000,000
  • The bond amount should be 5% of the projected receivable contributions and premiums for the upcoming year

Third party administrators who maintain a Claims Administration Services Account (CASA) and Administrator Trust Fund (ATF)

  • $50,000 up to $1,000,000
  • 5% of the projected claims and claims expenses to be held in the CASA for the upcoming year
  • 5% of the projected receivable contributions and premiums for the upcoming year

 

How can I get a Third Party Administrator Bond?

STEP 1: Apply for the bond

You need to submit a bond application to us. If you’re ready to apply now, you may do so HERE!

STEP 2: Underwriting

We will ask you a couple of relevant information needed for the bond. This will include your financial history, business performance history, and your credit score. An expert underwriter will take a thorough look at all those.

STEP 3: Bond execution

Once the underwriter is done with the prequalification process, we will immediately issue the bond and send it to you!

 

What are the surety bond requirements?

  • The surety bond should be issued by a Surety that is authorized to conduct business in the State of Illinois
  • The People of the State of Illinois should be named as the Obligee
  • The third-party administrator must comply with the provisions of Sections 511.100 – 511.118 of the Illinois Insurance Code as well as the rules and regulations of the Illinois Department of Insurance
  • If the third party administrator commits a violation, the aggrieved party will be eligible to file a claim against the bond

GET YOUR FREE SURETY BOND QUOTE TODAY!

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