Georgia Lottery Retailer Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a Georgia Lottery Retailer Bond
At a Glance:
- Lowest Cost: 1.5% of the bond amount per year based on the applicant’s credit score
- Bond Amount: Determined on a case by case basis (more on this later)
- Who Needs it: Georgia lottery retailers who do not meet the financial responsibility requirements set by the Georgia Lottery Corporation (GLC)
- Purpose: To ensure the public will receive compensation if the retailer fails to remit all funds owed to the GLC
- Who Regulates Lottery Retailers in Georgia: The Georgia Lottery Corporation
Background
Georgia statute 50-27-19 grants the GLC the authority to require retailers to purchase a surety bond prior to receiving a lottery license. The Georgia legislature enacted the bonding requirement to ensure that the GLC receives all funds owed to them by retailers. The bond amount is determined on a case-by-case basis but may not exceed twice the ticket sales average of the retailer’s district for two billing periods.
What is the Purpose of the Georgia Lottery Retailer Bond?
Georgia requires certain lottery retailers to be bonded prior to obtaining a retailer license. The bond ensures that the public will receive compensation for financial harm if the retailer fails to comply with the regulations set forth in Georgia statute 50-27-1. Specifically, the bond protects the public in the event the retailer fails to remit all funds owed to the GLC. In short, the bond is a type of insurance that protects the public if the lottery retailer company breaks licensing laws.
How Can an Insurance Agent Obtain a Georgia Lottery Retailer Bond?
BondExchange makes obtaining a Georgia Lottery Retailer surety bond easy. Simply log in to your account and use our keyword search to find the “lottery” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
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How is the Bond Amount Determined?
If the GLC determines that the retailer must purchase a surety bond, then they will examine the retailer’s credit, criminal, and business history when calculating the bond amount. The GLC conveniently provides a guide disclosing how they determine the required bond limits, which can be found on page 11 of the Georgia Lottery Retailer License application. In no circumstance shall the bond amount exceed the retailer’s district sales average of lottery tickets for two billing periods.
Is a Credit Check Required for the Georgia Lottery Retailer Bond?
Surety companies will run a credit check on the owners of the retail company to determine eligibility and pricing for the Georgia Lottery Retailer bond. Owners with excellent credit and work experience can expect to receive the best rates. Owners with poor credit will likely be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the owner’s credit.
How Much Does the Georgia Lottery Retailer Bond Cost?
The Georgia Lottery Retailer surety bond can cost anywhere between 1.5% to 20% of the bond amount per year. Insurance companies determine the rate based on a number of factors including your customer’s credit score and experience. The chart below offers a quick reference for the approximate bond cost on a $10,000 bond requirement.
$10,000 Lottery Retailer Bond Cost
| Credit Score | Bond Cost (1 year) | Bond Cost (1 month) |
|---|---|---|
| 800+ | $150 | $15 |
| 650 – 699 | $200 | $20 |
| 625 – 649 | $500 | $50 |
| 600 – 624 | $1,000 | $100 |
| 550 – 599 | $2,000 | $200 |
*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.
Who is Required to Purchase a Bond?
The GLC will determine whether a retailer needs to purchase a bond after reviewing their license application. The GLC will examine factors such as the retailer’s credit history, criminal record, and business infractions they have committed when determining whether or not the retailer needs a bond. To establish if your customer needs to purchase a bond, utilize the bonding guide located on page 11 of the retailer license application.
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How do Retailers Apply for a Lottery License in Georgia?
Lottery retailers in Georgia must navigate several steps to secure their licenses. Below are the general guidelines, but applicants should refer to the application packet for details on the process.
License Period – All Georgia Lottery Retailer Licenses are valid for one year from the date of issuance and must be renewed before the expiration date
Step 1 – Contact the Lottery Corporation
The first step to obtaining a retailer license is to contact the retailer’s GLC District Sales Office. The GLC will provide the retailer with all pertinent application forms and walk them through the application process.
Step 2 – Complete the Application
All Georgia Lottery Retailer License applications should be mailed to the following address:
Georgia Lottery Corporation
P.O. Box 56486
Atlanta, GA 30343
Retailers must complete the application in its entirety, and submit all documents contained within the application packet. There is a $125 application fee that must be paid when the application is submitted.
Step 3 – Purchase a Surety Bond
After the retailer submits their application, the GLC will inform them whether or not they need to purchase a surety bond. To determine whether your customer needs to purchase a surety bond and to calculate the required amount, refer to page 11 of the application.
How Do Georgia Lottery Retailers Renew Their License?
Prior to their licenses’ expiration dates, the GLC will contact retailers and present them with instructions on how to renew their licenses. Retailers should mail their completed renewal application to the following address:
Georgia Lottery Corporation
P.O. Box 56486
Atlanta, GA 30343
All Georgia Lottery Retailer Licenses are valid for one year from the date of issuance and must be renewed before the expiration date.
What Are the Insurance Requirements for the Georgia Lottery Retailer License?
Georgia does not require retailers to obtain any form of liability insurance as a prerequisite to obtaining a lottery license. Retailers who do not meet the required financial responsibility requirements may need to purchase a surety bond in an amount set by the GLC but does not exceed twice the ticket sales average of the retailer’s district for two billing periods.
How Do Georgia Lottery Retailers File Their Bond?
Lottery retailers should mail their completed bond form, including the power of attorney, to the following address:
Georgia Lottery Corporation
P.O. Box 56486
Atlanta, GA 30343
The Georgia Lottery Retailer surety bond requires signatures from both the surety company that issues the bond and a representative from the retail organization. The surety company should include the following information on the bond form:
- Legal name and address of entity/individual(s) buying the bond
- Surety company’s name and state of incorporation
- Bond amount
- Date the bond is signed
What Can Georgia Lottery Retailers Do to Avoid Claims Against Their Bond?
To avoid claims against their bond, lottery retailers in Georgia must ensure that they pay all funds owed to the Georgia Lottery Corporation.
What Other Insurance Products Can Agents Offer Lottery Retailers in Georgia?
Georgia does not require retailers to obtain any form of liability insurance as a prerequisite to obtaining a lottery license. However, most reputable businesses will seek to obtain this insurance anyway. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Georgia Retailer Customers?
Georgia conveniently provides a public database to search for active lottery retailers in the state The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.
