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Illinois Public Adjuster Bonds

What is an Illinois Public Adjuster Bond?

The Illinois Department of Insurance (IDOI) requires all licensed public adjusters to provide $50,000 of "financial responsibility." A surety bond, Illinois public adjuster bond, is the best way to satisfy this requirement.

The public adjuster bond is a special type of insurance contract you're required to purchase as a guarantee you'll follow the laws and regulations set forth by the Illinois Department of Insurance and service your customers with ethical business practices.

When you purchase your Illinois public adjuster bond, you're making this promise to the IDOI and your customers.

New $50,000 Bond Requirement (1/1/2024)!

Effective on Jan. 1, 2024, all Illinois Public Adjusters are required to have a $50,000 surety bond (formerly a $20,000) surety bond. The IL Department of Insurance will not accept a change rider so a new bond is required.

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Who is Required To Purchase the Illinois Public Adjuster Bond?

Every licensed public adjuster must provide "evidence of financial responsibility" in the form of a surety bond or an irrevocable line of credit in the amount of $50,000.

$50,000 is the amount of financial protection available to customers in the case of purposeful financial harm or fraud.

Why is an Illinois Public Adjuster Bond Required?

Why Is the Illinois Public Adjuster Bond Required?

By issuing you a license, the Illinois Department of Insurance is endorsing you as an insurance expert the public can trust to provide accurate values when negotiating with insurance companies and to handle negotiations with the clients best interest at heart.

It's unfortunate, but there will always be a few licensed public adjusters who purposefully:

  • Charge exorbitant fees for successful claims
  • Falsely recommend a customer to increase the number of claims for higher commissions
  • Lying to a customer or insurance company to extract higher claim payouts

If a public adjuster is found guilty of any of these acts, or similar acts of fraud, the $50,000 is available to a customer for partial or full reimbursement. However a payment for damages can only extend to the $50,000 amount.

How Much Does the Illinois Public Adjuster Bond Cost?

Purchasing a surety bond makes the most sense to satisfy the $50,000 of "financial responsibility" requirement.

The two options are:

  • An irrevocable line of credit
  • A surety bond

The Irrevocable Line of Credit

An irrevocable line of credit is a guarantee for a payment issued by a bank which cannot be cancelled during the time the public adjuster license is active.

The secure a line of credit, typically the full $50,000 is due upfront as collateral and held by the bank. Even after a public adjuster decides to not offer services anymore, the bank will hold onto the funds for a set amount of time in the event of any claims.

The line of credit is typically not an option for most people.

Keep in mind that the state is the only investigator if there should be a claim as banks don't have this capacity.

The Surety Bond

The public adjuster surety bond is purchased similar to a traditional insurance policy. You're responsible for paying a premium to secure the full $50,000 "coverage."

The premium is calculated by examining the applicants personal credit history. However, Surety Bonds Direct works with multiple A rated sureties and has secured low fixed prices with zero credit check.

Bond Term Bond Amount Purchase Today
1 Year Bond Term $500 Click to Purchase
2 Year Bond Term $875 Click to Purchase
3 Year Bond Term $1,250 Click to Purchase

This means once you purchase a public adjuster surety bond, Surety Bonds Direct can have it issued to you within one business day. The IDOI allows us to email it to you so you can submit it with your final application.

Should there be a claim on your bond, the surety will investigate the claim for you (although it's always best to try and remedy the situation directly with your customer).

How Long Does the Illinois Public Adjuster Bond Last?

The duration of the public adjuster bond is called the bond term.

Surety Bonds Direct offers three bond terms:

Bond Term Bond Amount Purchase Today
1 Year Bond Term $500 Click to Purchase
2 Year Bond Term $875 Click to Purchase
3 Year Bond Term $1,250 Click to Purchase

The difference is a longer bond term:

  • Offers you a discount on the price
  • Means you don't have to worry about the bond renewal for a longer period of time

Whichever bond term you choose, it will remain active from the effective date for the one, two, or three year period.

How Do You Renew a Public Adjuster Bond?

Renewing an Illinois public adjuster bond is easy. As your bond expiration date approaches, your bond specialist will contact you 30 to 45 days in advance to ensure you don't miss paying the renewal premium.

The renewal premium is the current price of the bond at the time of renewal. In most cases these prices don't change very much, unless the bond amount is changed by the Illinois Department Insurance.

The Illinois public adjuster bond is continuous. This means, once you pay the renewal premium the original bond you filed with your application remains active. There is no additional paperwork required.

Public Adjuster Bonds And Getting Your Illinois Business License/Registration

Getting an Illinois public adjuster license is very straightforward. For the details of each step, read our post outlining how to get the Illinois public adjuster license.

At a high level, these are the following steps:

  • Pass the Illinois public adjuster examination
  • Complete the application
  • Secure the required documentation
  • Document 1 - the surety bond
  • Document 2 - the adjuster contractor template
  • Submit application and complete background check

You can keep up to date with any change in licensing and additional requirements by bookmarking the Illinois Department of Insurance public adjuster page.