Collection Agency Bond

Collection agencies play a crucial role in debt recovery, managing sensitive consumer data and financial details. Due to their high-risk nature, some states require collection agencies to obtain collection agency surety bonds to ensure credibility and dependability. To receive a business license, collection agencies in most states must obtain a collection agency bond. This bond ensures that professionals within the industry adhere to industry regulations and ethical practices. It also guarantees that collection agencies handle funds received from debt recovery responsibly, directing them appropriately to the owed company.

What is a Collection Agency Bond?

Each collection agency surety bond involves three parties:

• The principal: The collection agent or agency purchasing the bond.
• The obligee: The government agency requiring the bond.
• The surety: The insurance company issuing the bond.

If a collection agency misappropriates funds, the obligee can seek reimbursement by filing a claim against the agency's bond. In such cases, the surety is legally obligated to pay out the claim, up to the full bond amount. The surety will then seek reimbursement from the collection agency.

State-Specific Costs and Requirements:

The bond amounts and regulations for collection agency licenses vary from state to state. Consequently, the costs and requirements for collection agency bonds also fluctuate accordingly. Typically, the cost of a Collection Agency bond can start at just $100 for bonds less than $10,000 or 1% of the bond amount for bonds over $10,000

For a detailed quote for a Collection Agency Bond, complete a quote request today, or call ProSure Group at (800) 480-3883. Our experienced and professional agents can help guide you through the bond process quickly and efficiently.