Alabama Auctioneer Bond: A Comprehensive Guide
November 24, 2021
This guide provides information for insurance agents to help their customers obtain Alabama Auctioneer Bonds
At a Glance:
- Average Cost: $100 per year
- Bond Amount: $10,000
- Who Needs it: All auctioneers operating in Alabama
- Purpose: To ensure the public will receive compensation for any damages should the auctioneer violate licensing law
- Who Regulates Auctioneers in Alabama: The Alabama Board of Auctioneers
Alabama statute 34-4-20 requires all auctioneers operating in the state to obtain a license with the Board of Auctioneers. The Alabama legislature enacted the licensing laws and regulations to ensure that auctioneers engage in ethical business practices. In order to provide financial security for the enforcement of the licensing law, auctioneers must purchase and maintain a $10,000 surety bond to be eligible for licensure.
What is the Purpose of the Alabama Auctioneer Surety Bond?
Alabama requires auctioneers to purchase a surety bond as part of the application process to obtain a business license. The bond ensures that the public will receive compensation for financial harm if the auctioneer fails to comply with the regulations set forth in the Alabama Auctioneer License Act. Specifically, the bond protects the public in the event the auctioneer engages in any acts of fraud or breaches any contracts made with consumers. In short, the bond is a type of insurance that protects the public if the auctioneer breaks licensing laws.
How Can an Insurance Agent Obtain an Alabama Auctioneer Bond?
BondExchange makes obtaining an Alabama Auctioneer surety bond easy. Simply log in to your account and use our keyword search to find the “auctioneer” bond in our database. Don’t have a login? Enroll now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
Is a Credit Check Required for the Alabama Auctioneer Bond?
No, a credit check is not required for the Alabama Auctioneer bond. Because the bond is considered relatively low risk, the same low rate is offered to all Auctioneers in Alabama regardless of their credit history.
How Much Does the Alabama Auctioneer Bond Cost?
The Alabama Auctioneer bond costs just $100 per year.
How Does Alabama Define “Auctioneer?”
To paraphrase Alabama statute 34-4-2, an auctioneer is any individual who offers or negotiates the sale of any item which may be offered for sale at a public auction.
How do Auctioneers Apply for a License in Alabama?
Auctioneers in Alabama must navigate several steps to secure their license. Below are the general guidelines, but applicants should refer to the application checklist for details on the process.
License Period – The Alabama Auctioneer License expires on September 30 of each year and must be renewed before the expiration date
Step 1 – Meet the Experience Requirements
To become a licensed auctioneer in Alabama, applicants must ensure that they satisfy all of the following criteria
- Be at least 19 years old
- Completed at least 85 hours of study at an accredited auctioneering school approved by the board (the board does not provide a list of approved schools)
- Has served at least 1 full year as an apprentice auctioneer under a licensed Alabama auctioneer
- Has been the principal auctioneer in at least 5 auctions as an apprentice
License applicants who did not complete a course of study must serve as an apprentice for 2 years and have been the principal auctioneer at least 10 auctions.
Step 2 – Purchase a Surety Bond
Auctioneers must purchase and maintain a $10,000 surety bond
Step 3 – Complete the Application
All Alabama Auctioneer License applications should be mailed to the following address:
Alabama State Board of Auctioneers
2777 Zelda Rd
Montgomery, AL 36106
The Alabama Auctioneer License application consists of the following items:
Step 4 – Pass the Exam
After submitting their completed license application, auctioneers will be mailed instructions from the board on how to register for the required examination. To obtain their license, auctioneers must pass the exam. There is a $100 examination fee that must be paid each time the exam is taken.
Step 5 – Pay the Application Fee
After passing the exam, auctioneers must pay a $200 license fee
How Do Alabama Auctioneers Renew Their License?
Auctioneers can complete their renewal applications online here. Auctioneers must pay a $200 renewal fee and, if applicable, a $50 late fee renewal fee. Auctioneers must complete 6 hours of continuing education each renewal period. The Alabama Auctioneer License expires on September 30 of each year and must be renewed before the expiration date.
What are the Insurance Requirements for Appraisal Management Companies in Alabama?
Alabama does not require appraisal management companies to obtain any form of liability insurance as a prerequisite to obtaining a business registration. Appraisal management companies must purchase and maintain a $25,000 surety bond.
What are the Insurance Requirements for Auctioneers in Alabama?
Alabama does not require auctioneers to obtain any form of liability insurance as a prerequisite to obtaining a business license. Auctioneers must purchase and maintain a $10,000 surety bond.
How Do Alabama Auctioneers File Their Bond?
Auctioneers should mail their completed bond forms, including the power of attorney, to the following address:
Alabama State Board of Auctioneers
2777 Zelda Rd
Montgomery, AL 36106
The Alabama Auctioneer surety bond requires signatures from both the surety company that issues the bond and from the auctioneer. The surety company should include the following information on the bond form:
- Legal name, city, and state of entity/individual(s) buying the bond
- Surety company’s name and address
- Bond amount
- Date the bond is signed
What Can Alabama Auctioneers Do to Avoid Claims Against Their Bond?
To avoid claims on their bond, auctioneers in Alabama must follow all license regulations in the state, including some of the most important issues below that tend to cause claim
- Do not engage in any acts of fraud
- Do not breach any contracts made with consumers
What Other Insurance Products Can Agents Offer Auctioneers in Alabama?
Alabama does not require auctioneers to purchase any form of liability insurance as a prerequisite to obtaining a business license. However, most auctioneers will seek to obtain insurance anyway. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Alabama Auctioneer Customers?
Alabama conveniently provides a public database to search for active auctioneers in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.