A hunting and fishing bond is a special and unique type of surety bond. In direct contrast with many other license-related surety bonds, a hunting and fishing bond is not issued to a company or individual that provides a service, but to an entity that provides hunting and fishing licenses. This is very similar –for example– to a lottery bond, which is issued on those entities who wish to sell lottery tickets. The main purpose of the bond remains very similar to other surety bonds: to protect the customer and the government agencies against any failure from the licensing company to act in accordance to the law or any implicated regulations. A hunting and fishing bond is required by every state government entity in order for a company to be legally able to issue hunting and fishing licenses. The exact expectations that this type of bonds will entail are varied, and depend mostly on the specific legal language in which is underwritten, but they all have the same objective: to protect the customer against unlawful transaction or financial loss.
As with every other surety bond, a hunting and fishing bond involves three parties in its contract. The first party is known as the Principal. The principal is the company or individual that wishes to be legally able to issue hunting and fishing licenses. The bond will oblige the company or individual to act within the frames of the laws that regulate the hunting and fishing licensing industry. It is a financial guarantee that every licensing issuer must have prior to starting any related business.
The second party involved is the Obligee. This party is the one that will require the bond to be purchased before entitling an individual or a company with the legal ability to issue hunting and fishing licenses. It is usually represented by a state government agency. The obligee is the party in charge of regulating the bonded industry. The hunting and fishing bond will also protect the obligee from any financial loss that could come from a claim made against the bond.
The third and final party is the surety. This is the party that will sell, underwrite and issue the bond. The surety is also the financial grantor within the bond, thus it is recommended that a financially strong company play this part. An insurance company usually plays the role of surety. As the issuer of the bond, the surety has certain obligations to both the obligee and the particular. Whenever the principal violates one or some of the laws regulating the hunting and fishing license industry, the obligee can make a claim against the bond. The surety then has the obligation to study the situation in order to determine if the claim is valid. In an event of a valid claim, the surety will pay the obligee for any harm or damage done by the incapacity of the principal to act in full accordance to the law. The surety will ask the particular for reimbursement of the paid amount plus any legal fees incurred while studying the claim.
The coverage prices for hunting and fishing bonds will depend on the state they are issued. They mostly depend on the popularity of the sport in that region. For example, in states where hunting and fishing are popular, a company that issues licenses is likely to succeed, thus bonding coverage prices should be lower. It also depends on the duration of the bond –the time the bond will last effective. Most bonds are paid every six months or annually. Average coverage prices for hunting and fishing bonds range from $7,000 to $12,000, but there are states, such as Florida or Arkansas, where the price is as low as $1,000. In Alabama, the coverage price for a bond of this type is $20,000.
A hunting and fishing bond will assure, both to the costumer and to any government entity involved, that the participant will provide good-quality service. It is a financial tool required prior to licensing that helps achieve successful transactions, keep a clean and honest business between customer and licensing company.