
Chatsworth, CA 91311-4926
A type of license bond, the escrow agency surety bond exists to protect the public from harm resulting from errors or unlawful practices. Escrow agencies in many states are required to have a surety bond in order to be licensed for business.
Your state will require a surety bond for your escrow agency as part of the business licensing process. If there is a claim against your business that you are unable to pay, a claim may be made against the surety bond to guarantee payment up to the bond limit. The surety company will seek reimbursement from the principal for any losses.
The cost of surety bond premiums for escrow agents can range from $250 to $5,000, with the coverage amount ranging from $10,000 to as high as $500,000, depending on your state.
In California, for example, a $25,000 escrow agency bond is required, which carries an annual premium of $250. Premiums vary in other states depending on your business's financial health as well as the owner's personal credit score.
State | Bond Amount | Cost* (Annual Premium) |
---|---|---|
Arizona | $100,000 | $1,000 |
California | $25,000 | $250 |
Montana | $100,000 | $1,000 |
Nevada | $20,000 - $250,000 | Varies* |