How to Get a Georgia Lottery Bond Application
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 Georgia lottery bond application needs.
How Do I Get a Lottery Retailer Agents License?
Your pathway toward becoming a Georgia lottery retailer begins with a phone call to your nearest Georgia Lottery Corporation District Sales Office. They will provide you with important information regarding licensing and accept your completed application when you’re ready to submit it.
What Does the Licensing Process Involve?
In applying for a license as a Georgia lottery retailer, you allow the Georgia Lottery Corporation (GLC) to investigate, including checks of your credit history, criminal record, federal, state, and local taxes owed. If they approve you for a license, this information will help the GLC determine whether you are required to provide a Financial Security Deposit (FSD) and in what amount.
The GLC Retail Contracts Administration Department will notify you if you are subject to the FSD requirement, which you may satisfy with a Georgia lottery bond if you don’t want to tie up your funds or credit with a cash escrow or letter of credit. (Most lottery retailers choose the bonding option!)
Why Is a Lottery Bond Required?
A Georgia Lottery bond serves two key purposes:
- It is a guarantee that the lottery retail (the bond’s “principal”) will abide by all statutes and GLC rules regarding the sale of lottery products and remit lottery sales proceeds to the state according to the terms of the Lottery Retailer Contract.
- It provides a way for GLC (the bond’s “obligee”) to recover funds owed to the state by the principal and for consumers who experience a financial loss, due to the principal’s unlawful or unethical actions, to be compensated.
How Does a Lottery Bond Work?
In addition to the obligee and the principal, there is a third party to a Georgia lottery bond—the bond’s guarantor (the “surety”). The surety guarantees the payment of claims, but the legal obligation to pay all valid claims belongs solely to the principal. Nevertheless, as the guarantor, the surety will pay a legitimate claim initially and then receive reimbursement by the principal. The surety is indemnified by the terms of the surety bond agreement against liability for claims and therefore can take legal action against a principal who fails to repay the debt caused by the surety’s payment of claims on the principal’s behalf.
What Does a Lottery Bond Cost?
Two factors go into calculating the premium cost of a Georgia lottery bond: the required bond amount established by the obligee and the premium rate set by the surety, both of which are determined on a case-by-case basis. The primary underwriting consideration is the risk the surety takes on in paying claims on the principal’s behalf, which is gauged largely by the principal’s personal credit score.
The underwriting assumption is that a principal with good credit is likely to repay the surety, which means the risk is low, resulting in a low premium rate—typically in the range of one to two percent. A principal with a low credit score is assumed to present a higher risk to the surety, which results in a higher premium rate.
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Our surety bond professionals will get you the Georgia lottery retailer license you need at a competitive rate.