Category: Bond Articles

SFAA Comments on Arkansas Pharmacy Benefit Managers Regulations

SFAA submitted comments to the Arkansas Insurance Department (Department) to address proposed regulations that would require pharmacy benefit managers (PBM) to post a $1 million license bond.  The proposed rules would permit direct actions on the bond.  If the bond amount would cause the PBM significant financial hardship, the Insurance Commissioner could reduce the amount required.  We explained the surety?s underwriting process and noted that the high bond amount could reduce the bond?s availability.  Similarly, we explained that the proposed regulations contain a broad obligation in the bond?s conditions with regard to complying with any statute.  We recommended that the scope of the bond?s conditions be limited to compliance with the applicable laws and regulations for PBMs.  SFAA offered to work with the Department on these issues to improve the bond?s availability.  The proposed rules also provide that a PBM that furnishes a $1 million bond under the PBM regulation need not furnish a $25,000 bond under the TPA regulation.

Members should visit Advocacy / General Info (Members) for more information.

Statutory and Regulatory Provisions Governing Fidelity and Surety Filing Requirements – Rate and Form Filing Status By Jurisdiction  SFAA?s Rate and Form Filing Chart has been updated for recent statutory changes.

For Members only (or navigate to Member Services / Regulatory)

Updates to the Binder of Standard Forms to include Illinois specific material for the ERISA Dishonesty Bond have been posted.  Details on the latest updates are on the Countrywide Filings page. 

The Binder of Standard Fidelity and Forgery Forms is accessible online for Members, Subscribers, and Claims Advisors.   Hard copy order form for non-Members:

SFAA Addresses Coverage for Virtual Currency in Money Transmitter License Bond Rules

SFAA submitted comments to the Washington Department of Financial Institutions to address proposed rules for money transmitters that expanded the meaning of money transmission to include the transmission of virtual currency. The bond?s existing condition requires the surety to secure the licensee?s compliance with this law. SFAA explained the risks in underwriting virtual currency transmissions due to the volatile fluctuations in the value of the currency. Virtual currency is subject to minimal regulation, is vulnerable to cyberattacks, and the accounts are not insured by the Federal Deposit Insurance Corporation. Underwriting these risks could increase the surety?s exposure by amounts that are difficult to quantify or identify so that the surety bond?s coverage should not be extended to cover them since it could negatively affect the bond?s availability.

Members should visit Advocacy / General Info (Members) for more information.

New bonding opportunities enacted in the state legislature that may be of interest to SFAA members has been posted. The report is divided by line of business: contract surety, commercial surety, and fidelity bonds. For your reference, we have included the date of enactment for each bill. SFAA updates this list periodically as new bonding opportunities are enacted.

Access the New Bonding Opportunities now

The Subscribers to SFAA Fidelity and Surety Case Summaries list has been updated for Members, Claims Advisors and Case Summary Subscribers.

Navigate to Member Services / Claims / Subscribers to Case Summaries.

The U.S. Treasury Department has issued its annual update to Circular 570 for 2018. Treasury reports the following updates for this year?s publication:

July 3, 2018:

Ironshore Specialty Insurance Company (NAIC #25445) voluntarily relinquished its Treasury Certificate of Authority, which became effective June 30, 2018.

July 3, 2018:

Texas Pacific Indemnity Company (NAIC #20389) merged into its parent company, Pacific Indemnity Company, which was effective on September 30, 2017.

View list of Additions and
Terminations

SFAA Defeats Bond Waiver Bill in Rhode Island

SFAA and AIA defeated Rhode Island HB 7809/SB 2513, which would have granted the chief purchasing officer the discretion to waive the state bond requirements for projects up to $250,000. The bill also would have increased the state bond threshold for public works projects from $50,000 to $100,000.

Members should visit Advocacy / General Info (Members) for more information.

SFAA and NASBP Address Bonding for FCC-Funded Projects in U.S. Territories

Members should visit Advocacy / General Info (Members) for more information.