Alabama Termite Control Bond: A Comprehensive Guide

June 22, 2022

Alabama Termite Control Bond

This guide provides information for insurance agents to help their customers obtain an Alabama Termite Control bond

At a Glance:

  • Average Cost: $100 per year
  • Bond Amount: $2,500
  • Who Needs it: All termite exterminators operating in Alabama
  • Purpose: To ensure the public will receive compensation for financial harm if the exterminator violates licensing law
  • Who Regulates Termite Exterminators in Alabama: The Alabama Department of Agriculture and Industries

Background

Alabama Statute 5-28-4 requires all termite exterminators operating in the state to obtain a professional services license from the Department of Agriculture and Industries. The Alabama legislature enacted the licensing requirement to ensure that termite eradicators engage in ethical business practices. To provide financial security for the enforcement of the licensing law, termite eradicators must purchase and maintain a $2,500 surety bond to be eligible for licensure.

What is the Purpose of the Alabama Termite Control Bond?

Alabama requires termite exterminators to purchase a surety bond as part of the application process to obtain a professional services license. The bond protects the public if the exterminator violates the provisions set forth in Alabama Statute 2-28-10.1. Specifically, the bond protects the public if the exterminator engages in any acts of fraud or abandons a job. In short, the bond is a type of insurance that protects the public if the termite exterminator violates the terms of their license.

Alabama Termite Control Bond Form

Alabama Termite Control Bond Form

How Can an Insurance Agent Obtain an Alaska Termite Control Surety Bond?

BondExchange makes obtaining an Alaska Termite Control bond easy. Simply log in to your account and use our keyword search to find the “Termite” 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.

Not an agent? Then let us pair you with one!

BX Agent Finder Link

Click the above image to find a BX Agent near you

Is a Credit Check Required for the Alabama Termite Control Bond?

No, a credit check is not required for the Alabama Termite Control bond. Because the bond is considered relatively low risk, the same low rate is offered to all termite exterminators in Alabama regardless of their credit history.

How Much Does the Alabama Termite Control Bond Cost?

The Alabama Termite Control bond costs just $100 per year.

Who is Required to Purchase the Bond?

Alabama requires termite exterminators to purchase a surety bond as a prerequisite to obtaining a business license. To paraphrase Alabama statute 2-28-1, a termite exterminator is a person that eliminates and/or prevents the spread of termites in any residential or commercial building.

How Do Termite Exterminators Apply for a License in Alabama?

Termite exterminators in Alabama must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the licensing statutes for details on the process.

License Period – All Alabama Professional Services Licenses expire on September 30 of each year and must be renewed before the expiration date

Step 1 – Determine the License Type

There are multiple classifications of the Alabama Department of Agriculture and Industries Professional Services License, as outlined below:

    • Maine office: Required for the exterminator’s main business location
    • Branch Office: Required for all branch offices of the exterminator’s business
    • Sub-Office: Required for offices with less than 3 employees that are located less than 100 road miles from the main office

All termite extermination businesses must hold a main office license.

Step 2 – Purchase a Surety Bond

Terminate exterminators must purchase and maintain a $2,500 surety bond

Step 3 – Purchase Insurance

Alabama requires termite exterminators to purchase liability insurance with a minimum limit of $150,000. Additionally, exterminators that provide inspections for real estate transactions must purchase a minimum of $100,000 worth of errors and omissions (E&O) coverage. Exterminators must submit a certificate of insurance with their license application.

Step 4 – Complete the Application

All professional service services license applications should be mailed to the following address:

Department of Agriculture and Industries
Pesticide Management – Professional Services
1445 Federal Drive
Montgomery, AL 36107

Exterminators must complete the application in its entirety, and pay all required fees.

How Do Alabama Termite Exterminators Renew Their Licenses?

Termite exterminators should mail their completed renewal applications, including all required fees, to the following address:

Department of Agriculture and Industries
Pesticide Management – Professional Services
1445 Federal Drive
Montgomery, AL 36107

All Alabama Professional Services Licenses expire on September 30 of each year and must be renewed before the expiration date.

Exterminators must conduct an annual inspection of all jobs performed within the term of the contract to ensure a reinfestation has not occurred. Additionally, exterminators must file a monthly report with the department of all jobs performed within the month. Exterminators who do not comply with these requirements may have their renewal applications denied.

What are the Insurance Requirements for Termite Exterminators in Alabama?

Alabama requires termite exterminators to purchase $150,000 worth of liability insurance. If the exterminator performs inspections for real estate transactions they must purchase $100,000 worth of E&O insurance as well. Termite exterminators must purchase and maintain a $2,500 surety bond.

How Do Alabama Termite Exterminators File Their Bonds?

Termite exterminators should mail their completed bonds form, including the power of attorney, to the following address:

Department of Agriculture and Industries
Pesticide Management – Professional Services
1445 Federal Drive
Montgomery, AL 36107

The bond requires signatures from both the surety company that issues the bond and from the exterminator. The surety company should include the following information on the bond form:

  • Legal name of entity/individual(s) buying the bond
  • Surety company’s name
  • Date the bond is signed

What Can Alabama Termite Exterminators  Do to Avoid Claims Against Their Bonds?

To avoid claims on their bonds, termite exterminators must follow all license regulations in the state, including some of the most important issues below that tend to cause claims.

  • Do not engage in any acts of fraud
  • Do not breach any contracts made with consumers
  • Do not abandon any jobs

What Other Insurance Products Can Agents Offer Termite Exterminators in Alabama?

Alabama requires termite exterminators to purchase liability and E&O insurance. Bonds are our only business at BondExchange, so we do not issue liability or E&O 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 Termite Exterminators in Alabama?

Alabama conveniently provides a public database of active termite exterminators in the state. Contact BondExchange for help developing a marketing piece. Agents can also leverage our print-mail relationships for discounted mailing services.

 

2022-06-22T18:21:09-04:00