Connecticut Private Occupational School Bond
Surety Bond Professionals is a family owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all of your Connecticut private occupational school bond needs.
What Are Connecticut Private Occupational School Bonds?
Connecticut private occupational school bonds ensure that prepaid tuition and fees will be returned to students if the school (they are enrolled in) closes its doors before they have received the educational services they are entitled to and no refund is issued by the school.
Who Needs Them?
The state of Connecticut issues operating certificates to new private occupational schools only if they are accredited by a recognized accreditation entity and meet all other requirements for operating within the state. The Connecticut Office of Higher Education requires private occupational schools applying for an operating certificate to deposit a certain amount of money into a private occupational school student protection account to be used to compensate students who should have been refunded prepaid tuition and fees but were not.
It’s not uncommon for school owners to voluntarily purchase a surety bond as well. Being bonded gives students (and parents) confidence they will receive the educational services they paid for or have their money refunded. A Connecticut private occupational school bond can be a great marketing tool.
How Do They Work?
In purchasing a Connecticut private occupational school bond, the school’s owner is guaranteeing to operate lawfully and ethically. If the school becomes insolvent or closes for some other reason, or fails to deliver the educational services promised (such as guaranteed job placement), and any refund from the student protection account does not cover the full amount of prepaid tuition and fees, a student or parent can file a claim against the surety bond.
How Are Claims Paid?
The surety bond agreement legally obligates the school’s owner (the bond’s “principal”) to pay all valid claims. The bond’s guarantor (known as the “surety”) will determine whether a claim is valid and, having guaranteed the payment of valid claims, will pay the claim initially to expedite its resolution. However, this initial payment is an extension of credit to the principal, who must repay the resulting debt to the surety or face legal action by the surety to recover the claim amount.
How Much Do They Cost?
Two factors go into the surety’s calculation of the annual premium cost for a Connecticut private occupational school bond: the bond amount requested by the principal and the premium rate assigned by the surety. The premium rate determination rests on an underwriting assessment of the risk that the principal will incur claims and not repay the surety claims paid on the principal’s behalf.
The primary factor influencing the premium rate is the principal’s personal credit score, which says a lot about the individual’s level of financial responsibility. Someone with a high credit score is assumed to present little risk to the surety and therefore deserves a low premium rate. A principal with lesser credit is considered a greater risk, so the premium rate will be higher.
The average well-qualified principal will pay a premium rate that’s in the range of one to three percent.
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Our surety bond professionals will get you the Connecticut private occupational school bond you need at a competitive rate.