What is a Pennsylvania Private Licensed School Bond?
Any private school applying for a license or registration or renewal must include with its application evidence of a surety bond.
The Private Licensed School Bond guarantees reimbursement of the unearned tuition due to the students whenever the licensed or registered school closes.
According to the Private Licensed Schools Act, a “private licensed school” is any school or classes run for profit or tuition that offers resident instruction to prepare an individual to pursue an occupation in the skilled trades, industry or business, or systematic education by correspondence or by telecommunication in a field of study.
What is the bond amount?
For a prospective licensee applying for an original license: $10,000
For a licensee applying for a renewal license: $10,000 with gross tuition collected during the previous fiscal year of $500,000 or less
For licensees with total tuition received during the last fiscal year more than $500,000: $10,000 for each $500,000 or portion of gross tuition collected during the previous fiscal year
For a licensee applying for a renewal license: $100,000
For a registered school: $10,000 based on tuition generated by PA residents with a maximum amount of $100,000
The cost of the bond is a percentage of the bond amount (which serves as your bond premium). The rate can go from 1%-5% of the bond amount. A surety underwriter will conduct an in-depth evaluation of your credit score and financial statements.
How do I obtain a Private Licensed School Bond?
To secure this type of bond, the private school must seek the assistance of a surety bond company.
You will be asked to apply for this bond. If you’re ready to apply for one right now, click HERE for a free quote!
Once the application is received, the surety bond company will immediately process it. In our case, one of our expert surety bond agents will guide you through the whole process from the time you applied for the bond. We will make sure that you understand all the conditions before we issue the bond.
An underwriter will then evaluate the following:
- Your current financial statement
- Your job/business performance history
- Your credit score
- Your copy of the BOND FORM, which can be obtained from the Pennsylvania Department of Education.
Once the prequalification process is fulfilled, we will execute the bond and send it to you!
What are the bond conditions?
- The bond must be written by a Surety accepted and authorized to transact business in the Commonwealth of Pennsylvania.
- The form and level of Surety established by a school are subject to the approval of the State Board of Private Licensed School.
- The Principal must desire to operate its school at the location described in the manner required both by its express contracts with its students, the provisions of the Private Licensed Schools Act, and the regulations mandated by the State Board of Private Licensed Schools.
- The bond may be canceled by Surety by giving a 30-day notice in writing, by certified mail to the State Board of Private Licensed Schools.
- All applicable schools are required to maintain Surety at all levels throughout the licensure.