Worcester Pawnbroker Bond: A Comprehensive Guide
At a Glance:
- Average Cost: $100 per year or $10 per month
- Bond Amount: $300
- Who Needs it: All pawnbrokers operating in Worcester, Massachusetts
- Purpose: To protect the public from financial harm if the pawnbroker violates the terms of their license
- Who Regulates Pawnbroker in Worcester: The City of Worcester Police Department
Background
Worcester Revised Ordinance 14-7a requires all pawnbrokers operating in the city to obtain a license from the Worcester Police Department before conducting business. The Worcester City Council enacted the licensing requirement to ensure that pawnbrokers engage in ethical business practices. To provide financial security for the enforcement of the licensing law, pawnbrokers must purchase and maintain a $300 surety bond to be eligible for licensure.
What is the Purpose of the Worcester Pawnbroker Bond?
Worcester requires pawnbrokers to purchase a surety bond as part of the application process to obtain a pawnbroker license. The bond ensures that the public will be protected from financial harm if the broker fails to comply with the regulations set forth in the Worcester Revised Ordinance 14-7d. Specifically, the bond protects the public in the event the broker engages in any acts of fraud or breaches consumer contracts. In short, the bond is a type of insurance that protects the public if the pawnbroker violates the terms of their license.
How Can an Insurance Agent Obtain a Worcester Pawnbroker Surety Bond?
BondExchange makes obtaining a Worcester Pawnbroker bond easy. Simply log in to your account and use our keyword search to find the “Pawnbroker” 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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Is a Credit Check Required for the Worcester Pawnbroker Bond?
No, a credit check is not required for the Worcester Pawnbroker bond. Because the bond is considered relatively low risk, the same low rate is offered to all pawnbrokers in the city regardless of their credit history.
How Much Does the Worcester Pawnbroker Bond Cost?
The Worcester Pawnbroker bond costs just $100 per year or $10 per month.
Who is Required to Purchase the Bond?
Worcester requires all pawnbrokers to purchase a surety bond as a prerequisite to obtaining a pawnbroker license. To paraphrase Massachusetts General Law 140-76, a pawnbroker is defined as a person who issues loans to individuals that leave their property, as collateral, for the broker to sell on condition that the customer may repurchase the property within a fixed period of time.
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 Pawnbrokers Apply for a License in Worcester?
Pawnbrokers in Worcester must navigate several steps to secure a pawnbroker license. Below are the general guidelines, but applicants should contact the Worcester Police Department for details on the process.
License Period – All Worcester Pawnbroker Licenses expire on April 30th of each year and must be renewed before the expiration date.
Step 1 – Contact the Worcester Police Department
To obtain a license, pawnbrokers must contact the Worcester Police Department or visit their office at the following address:
License Division
Police Headquarters
9-11 Lincoln Square
Worcester, MA 01608
The department will walk them through the application process, provide them with all required forms, and answer any questions they may have. Pawnbrokers must submit a $100 application fee payable by check or money order with the application.
Step 2 – Purchase a Surety Bond
Pawnbrokers operating in Worcester are required to purchase and maintain a $300 surety bond.
How do Worcester Pawnbrokers Renew Their Licenses?
Pawnbrokers should contact the Worcester Police Department to obtain a renewal application before their license expires. All Worcester Pawnbroker Licenses are valid for two years from the date of issuance and must be renewed before the expiration date.
What are the Insurance Requirements for the Worcester Pawnbrokers?
Worcester does not require pawnbrokers to purchase any form of liability insurance. Pawnbrokers must purchase and maintain a $300 surety bond.
How Do Worcester Pawnbrokers File Their Bonds?
Pawnbrokers should submit their completed bond forms, including the power of attorney, to the Worcester Police Department at the following address:
License Division
Police Headquarters
9-11 Lincoln Square
Worcester, MA 01608
The surety bond requires signatures from both the surety company that issues the bond and from the broker. The surety company should include the following information on the bond form:
- Legal name of the entity/individual(s) buying the bond
- Surety company’s name and state of incorporation
- Name of the obligee and the license type applied for
- Bond amount
- Date the bond goes into effect
- Date the bond is signed
What Can Worcester Pawnbrokers do to Avoid Claims Against Their Bonds?
To avoid claims against their bonds, pawnbrokers in Worcester must ensure that they:
- Do not engage in any acts of fraud
- Do not breach contracts made with consumers
What Other Insurance Products Can Agents Offer Pawnbrokers in Worcester?
Worcester does not require pawnbrokers to purchase liability insurance. However, most reputable businesses will purchase this insurance anyway. Bonds are our only business at BondExchange, so we do not issue any other types of 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 Worcester Pawnbroker Customers?
Worcester unfortunately does not provide a public database of active pawnbrokers in the city. We suggest contacting the Worcester Police Department for a list of licensed pawnbrokers. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.
