04-02: Professional Bail Bondsman & Surety Recovery Act

To:           All Missouri Bail Bond Agents, General Bail Bond Agents, and Liability Insurers

From:      Scott B. Lakin, Director, Missouri Department of Insurance

Re:          SB 1122/Professional Bail Bondsman and Surety Recovery Agent Licensure Act

Date:       September 30, 2004

During its 2004 legislative session, the Missouri General Assembly enacted Senate Bill 1122, effective January 1, 2005, which amended chapter 374 of the Revised Statutes of Missouri by enacting the "Professional Bail Bondsman and Surety Recovery Agent Licensure Act." The Act substantially revises the current licensing and compliance requirements for bail bond licensees and grants the Department regulatory jurisdiction over surety recovery agents operating in the state of Missouri. The purpose of this bulletin is to outline major provisions of the act to aid licensed and potential bail bond, general bail bond and surety recovery agents in understanding the revised requirements under the law.

Please be advised that the following Bulletin does not constitute a comprehensive review of Senate Bill 1122. SB 1122 contains detailed compliance requirements that may be applicable to your company or to bail bond, general bail bond and surety recovery licensees. The Department strongly cautions all interested persons to independently review the recent legislation and to promptly take all necessary actions to ensure compliance with Missouri law. The following information is intended for preliminary guidance only, but may be consulted until such time as any necessary regulations have been promulgated.

Licensing:

Effective January 1, 2005, the Act changes the licensing criteria for applicants for a bail bond or general bail bond agent license and mandates that all surety recovery agents operating in Missouri must be licensed by the Department. Specifically, under the Act each application for a bail bond, general bail bond or surety recovery agent license must be accompanied by proof that the applicant is a citizen of the U.S., is at least 21 years of age and has a high school diploma or general education development certificate (GED). Applicants are also required to complete at least twenty-four (24) hours of initial basic training prior to being licensed, in addition to passing the qualifying examination. Bail bond agents and general bail bond agents licensed as of January 1, 2005, are exempt from the initial basic training requirement. Also exempted from the initial basic training requirement are applicants for a surety recovery agent's license with at least two years of peace officer experience within the last ten years prior to submitting an application to the department.

Section 374.700 defines a surety recovery agent as "a person not performing the duties of a sworn peace officer who tracks down, captures and surrenders to the custody of a court a fugitive who has violated a bail bond agreement, excluding a bail bond agent or general bail bond agent." Licensed Missouri bail bond and general bail bond agents are not required, however, to obtain a separate surety recovery agent license.

The Department is in the process of approving a qualifying examination for new surety recovery agents, which the Department anticipates will be available to Missouri applicants after December 1, 2004. Applicants may register for the examination after December 1, 2004, through the Department website. The exam content outline may be accessed at www.experioronline.com or on the Missouri website once available. The Department is also in the process of promulgating official rules that establish procedures for the licensing of new applicants and for the certification of initial basic education providers. The Department's proposed rules will be published in the Missouri Register on October 15, 2004. Until such regulations are promulgated, interested parties may consult the proposed rules for guidance on the Department's intended implementation and licensing procedures. The proposed rules may be accessed through the Department website.

To assist potential surety recovery license applicants who may not operate as a surety recovery agent in Missouri without a license from the Department after January 1, 2005, and to avoid an interruption in business activities, the Department will begin to accept applications for a surety recovery license on December 1, 2004. Please be advised that applications for a surety recovery license will only be accepted from individuals who have passed the qualifying examination and successfully completed the initial basic training requirement. Any license granted pursuant to these expedited procedures will not be effective, however, until January 1, 2005. Applicants seeking expedited license approval may use the forms and licensing procedures outlined in proposed regulations 20 CSR 700-6.100 and 20 CSR 700-6.150 which may be accessed through the Department website after November 1, 2004. To ensure licensure as of January 1, 2005, applicants should submit all necessary application materials and the required fee by December 15, 2004.

The Department will also begin accepting applications from persons desiring to be approved as an initial basic training provider effective immediately. Once an application has been approved, providers may begin offering the required training to potential applicants. To certify attendance and assist with reporting requirements, all course providers should issue a Certificate of Completion of Initial Basic Training to every attendant upon the successful completion of an initial basic training course. A form Certificate of Completion is available on the Department website. Applicants are cautioned to retain these certifications as proof of attendance. SB 1122 limits the fees a provider may charge for the initial education-training course to $ 200 per student.

Providers seeking initial basic training course approval may follow the application procedures outlined in proposed rule 20 CSR 700-6.150, Initial Basic Training, which the Department anticipates filing as an emergency rule prior to December 1, 2004. Proposed rule 20 CSR 700-6.150 outlines subject areas which should be included in training courses submitted for early approval. As indicated in the proposed rule, provider applicants should submit a one-time application fee of one hundred dollars ($100) for each course submitted. Forms for course providers and instructors can be accessed on the Department's website under Industry Forms, Bail Bonds. At this time, self-study and teleconference courses will not be eligible for approval for initial basic training.

As authorized by SB 1122, the licensing application fee for all bail bond, general bail bond and surety recovery agents has been increased to one hundred fifty dollars ($150). Information regarding licensing fees can be accessed on the department website at www.insurance.mo.gov under proposed regulation 20 CSR 700-6.100, Fees and Renewals. Additionally, all necessary licensing application forms may be found on the the Missouri Department of Insurance website.

Continuing Education:

SB 1122 requires all persons holding a Missouri bail bond agent, general bail bond agent or surety recovery agent license to complete eight (8) hours of approved continuing education during each two-year renewal period. The eight hours of continuing education shall be required of individuals with license renewal dates after January 1, 2006. Information regarding continuing education requirements for licensees and course providers can be accessed on the department website after the implementation date of January 1, 2005 at www.insurance.mo.gov under Missouri proposed regulation 20 CSR 700-6.160 Continuing Education for Bail Bond Agents, General Bail Bond Agents and Surety Recovery Agents.

Please note that SB 1122 imposes a fifty-dollar ($50) initial course application fee for continuing education providers, with an annual renewal fee of fifty dollars ($50) for each year the course is to be held. Costs for the biennial continuing education course(s) may not exceed one hundred fifty dollars ($150) per student. All forms for continuing education course approval may be accessed on the department website after January 1, 2005 at www.insurance.mo.gov under Industry Forms, Bail Bond.

Once again, all interested persons are encouraged to thoroughly review Senate Bill 1122. Copies of the new legislation and the Department's proposed rules may be obtained through the Department website. Should you have any questions or comments regarding this Bulletin, please contact the Licensing Section at (573) 751-3518 or at www.insurance.mo.gov.