Managing General Agent ($100,000) Bond - Statewide in Arkansas
Table of Contents
Brief Summary
Arkansas will not take anything in place of this bond. The MGA instructions say the original $100,000 bond on Form AID-LI-MGA 43 must be attached to the license application, with no substitution allowed. You pay a premium instead of posting $100,000 in cash, and the surety completes and signs the state's form for you.
A managing general agent applying for an Arkansas license must file an original $100,000 surety bond in favor of the State of Arkansas on Form AID-LI-MGA 43. The bond guarantees the MGA performs its duties under Ark. Code 23-64-401 and Arkansas Insurance Department rules. It goes in with the MGA 40 application, a $1,500 check and a copy of the errors and omissions policy.
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How to Apply for a Managing General Agent ($100,000) Bond:
- Complete Form AID-LI-MGA 40, leaving no question blank.
- Get a home state certification, less than 90 days old, showing the MGA is licensed and in good standing.
- Have the surety complete and sign the $100,000 bond on Form AID-LI-MGA 43.
- Attach the original bond, a copy of the errors and omissions policy and the $1,500 check payable to the Arkansas Insurance Department.
- Have the appointing insurer file Form AID-LI-MGA 41 and file the MGA contract on Form AID-LI-MGA 45.
- Mail the package to the Arkansas Insurance Department License Division.
Detailed Information About the Arkansas Managing General Agent ($100,000) Bond:
A single $100,000 bond, filed with the application
The Arkansas Insurance Department licenses managing general agents through its License Division. The amount is flat. Form AID-LI-MGA 43 binds the principal and surety to the State of Arkansas for one hundred thousand dollars, and the Department's instructions say the original bond must be attached to the license application. No other item can be substituted for it.
The bond is conditioned on the MGA performing all the duties and obligations of a managing general agent under Arkansas Code 23-64-401 and the Department's rules. If the agent does that, the obligation is void. If not, it stays in force for claims.
What goes in the license package
Form AID-LI-MGA 40 is the application for a corporation, LLC, LLP or partnership. With it the Department wants a copy of the Arkansas Secretary of State filing as a foreign entity where one applies, a home state certification less than 90 days old showing the MGA is licensed and in good standing, a $1,500 check payable to the Arkansas Insurance Department, a copy of the errors and omissions policy and the original bond.
The appointing insurer files Form AID-LI-MGA 41, and every contract between an insurer and an MGA is filed on Form AID-LI-MGA 45. Changes to that contract must be filed at least twenty days before they take effect.
Bond terms worth knowing
The bond is not cumulative, so $100,000 is the surety's total liability. It can be cancelled on thirty days written notice to the Department, and any suit on the bond must be filed within one year of the cancellation date. Premium is set by the surety after reviewing the agency's financials and the owners' credit.
Eligibility and Requirements for an Arkansas Managing General Agent ($100,000) Bond:
- Bond amount of exactly $100,000 in favor of the State of Arkansas.
- Department Form AID-LI-MGA 43. No substitute instrument is accepted.
- A surety company qualified and authorized to do business in Arkansas.
- Errors and omissions coverage, shown by a copy of the policy.
- Credit and financial review of the agency and its owners by the surety.
Arkansas Managing General Agent ($100,000) Bond FAQs:
No. The Department's instructions state that the bond must be completed on Form MGA 43 and that no other item can be substituted for it.
The State of Arkansas. The form is filed with the Arkansas Insurance Department License Division in Little Rock.
That the managing general agent performs all its duties and obligations under Arkansas Code 23-64-401 and the Department's rules.
The bond can be cancelled on thirty days written notice to the Arkansas Insurance Department. A suit on the bond must be filed within one year of the cancellation date.
