Surety Bond Encyclopedia

Public Adjuster ($10,000) Bond - Statewide in Texas

Brief Summary

Texas will not license a public insurance adjuster, resident or nonresident, until TDI has a surety bond of at least $10,000 that names you as the sole principal. An errors and omissions policy does not take its place. Once filed, the bond stays in force indefinitely with no continuation certificates, so it follows the license rather than expiring each year.

Every public insurance adjuster licensed by the Texas Department of Insurance must keep a surety bond of at least $10,000 under 28 Texas Administrative Code 19.705 and Insurance Code 4102.105. The bond is written on TDI Form FIN509, runs to the Texas Department of Insurance for the use and benefit of any customer, and is uploaded to the Sircon application along with the $50 license fee.

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How to Apply for a Public Adjuster ($10,000) Bond:

Pass the Texas public insurance adjuster exam through Pearson VUE unless an exemption on the TDI license page applies, such as a valid license in a reciprocal state.
Complete an IdentoGO fingerprint check and keep the receipt.
Buy a surety bond of at least $10,000 on TDI Form FIN509 with you listed as the sole principal.
Upload FIN509 and a copy of the original bond form to your Sircon application.
Pay the $50 application fee.
Nonresident applicants also provide an agent for service of process.

Detailed Information About the Texas Public Adjuster ($10,000) Bond:

The bond is a condition of keeping the license

Texas Insurance Code 4102.105 makes proof of financial responsibility a continuing condition of licensure for a public insurance adjuster. The statute lets the commissioner set the amount by rule and accept either a surety bond or a professional liability policy. The rule the commissioner adopted, 28 TAC 19.705, requires a surety bond in a principal sum of not less than $10,000. A professional liability or E&O policy is worth carrying, but it does not satisfy this rule.

If the surety wants out, it must give TDI written notice 30 days before the termination date. The surety stays liable for defaults committed before that date, and you need a replacement bond on file to keep meeting the financial responsibility requirement.

What the bond covers

Form FIN509 names the Texas Department of Insurance as obligee for the use and benefit of any customer. The bond is conditioned on you discharging losses that result from any final judgment a customer recovers against you. The surety's total liability for all claims is capped at the penal sum. Under 4102.105, the financial responsibility answers for judgments arising from an error, omission, fraud, negligent act or unfair practice by the adjuster or anyone whose acts the adjuster is legally liable for.

Who needs it

Under Insurance Code 4102.051, nobody may act as or hold themselves out as a public insurance adjuster in Texas without a license, and every applicant files the bond. That includes individuals and agencies, resident and nonresident. TDI requires that you be listed as the sole principal of the bond.

Section 4102.051(b) takes two groups out of the license requirement: a Texas licensed attorney who meets the condition in that subsection, and a general or personal lines property and casualty agent acting for an insured on a loss under a policy that agent issued.

Filing

Upload the completed FIN509 and a copy of the original bond form to your Sircon application and pay the $50 fee. Most applicants also need an IdentoGO fingerprint check. TDI does not offer a temporary or 90 day emergency public insurance adjuster license.

Eligibility and Requirements for a Texas Public Adjuster ($10,000) Bond:

Obligee: Texas Department of Insurance, for the use and benefit of any customer.
Penal sum of not less than $10,000 under 28 TAC 19.705.
A surety bond. A professional liability policy does not meet the rule.
Bond remains in force indefinitely with no continuation or renewal certificates.
Surety must give TDI written notice 30 days before terminating the bond.

Texas Public Adjuster ($10,000) Bond FAQs:

My E&O policy limit is far above $10,000. Do I still need the bond?

Yes. Insurance Code 4102.105 allows the commissioner to accept a professional liability policy, but the rule in force, 28 TAC 19.705, requires a surety bond of not less than $10,000. TDI's application page asks specifically for the FIN509 bond form.

Can my agency's bond cover me as an individual adjuster?

TDI's license page says you must be listed as the sole principal of the bond. Each applicant files a bond in its own name.

Do nonresident adjusters need a Texas bond?

Yes. TDI applies the same $50 fee and $10,000 bond requirement to nonresident applicants, who must also provide an agent for service of process.

Does the bond have to be renewed every year?

No renewal paperwork goes to TDI. Form FIN509 states the bond stays in full force indefinitely and continuation or renewal certificates are unnecessary. It ends only if the surety gives TDI 30 days written notice of termination.

Who can make a claim on the bond?

A customer who recovers a final judgment against the adjuster. The surety pays up to the $10,000 penal sum in total, no matter how many claimants there are.