Arizona — Third Party Administrator Bond
The Arizona Third Party Administrator Bond is a financial security instrument required for individuals or entities seeking to operate as an insurance administrator within the state. This bond ensures that the administrator performs their fiduciary duties honestly and fulfills legal obligations regarding the handling of premiums, return premiums, and other funds belonging to insured parties or insurers.
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- Recorded state
- Arizona
- Category
- Insurance professionals
What this bond does
This bond serves to protect insureds and insurers against financial loss resulting from fraud, dishonesty, or the failure of the administrator to pay benefits they are legally obligated to provide. It is a mandated financial guarantee that keeps administrators accountable to the standards set forth in Title 20, Chapter 2, Article 9 of the Arizona Revised Statutes.
- Who needs it
- This bond is intended for professional insurance administrators applying for a Certificate of Registration in Arizona. It is a necessary requirement for those who act in a fiduciary capacity when managing insurance funds for others.
- Who it protects
- The bond functions as a financial guarantee for the State of Arizona, as the Obligee, for the explicit benefit of insureds and insurers whose money the administrator handles. In instances of documented fraud, dishonesty, or failure to perform legal duties, the bond provides a mechanism for financial recovery, including applicable legal costs and attorney fees.
Your bond option
This is the option on record for this bond.
- Bond optionPurchase Now (opens in a new tab)Continue to our secure checkout partner, Propeller (opens in a new tab).
The bond amount describes the limit of the bond obligation, not the price. A listed amount does not establish what the requesting party requires. The premium is what you pay and must be confirmed for the actual option. An E&O limit, where listed, is separate errors and omissions insurance.
Sources
- Form E-157 TPA Bond (opens in a new tab)Checked October 18, 2026
Have these ready
- Verify the specific bond amount required by the Arizona Department of Insurance for your registration class.
- Ensure all fiduciary and administrative operations align with Title 20, Chapter 2, Article 9 of the Arizona Revised Statutes.
- Prepare the Power of Attorney document, as it must be attached to the bond for it to be officially accepted.
- Review all information for accuracy before signing, as the principal and surety are jointly and severally liable.
Questions about this bond
Who is the primary beneficiary of the Arizona Third Party Administrator Bond?
The bond is held for the benefit and protection of the insureds and insurers whose funds are handled by the administrator.
What actions trigger a claim on this bond?
The bond becomes due if the administrator fails to pay benefits they are legally obligated to provide, or if a loss occurs due to acts of fraud or dishonesty.
Does the surety have the authority to cancel the bond?
Yes, but the surety must provide 30 days of advance written notice to the Director of Insurance before the cancellation or any modification to the bond amount can take effect.
Is the administrator personally liable under this bond?
Yes, the principal and the surety are jointly and severally bound for the payment of the bond amount and any legal costs incurred to enforce the bond.