Alaska Educational Institution Bond

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Alaska Educational Institution Bond: A Comprehensive Guide

This guide provides information for insurance agents to help their customers obtain an Alaska Educational Institution bond

*Important Note: Persons who solicit enrollments for postsecondary educational institutions, or “agents”, are required to purchase a surety bond before obtaining an agent’s permit. However, this page focuses exclusively on the bonding requirements for the institutions themselves. To obtain an agent’s bond, contact BondExchange.

At a Glance:

  • Lowest Cost: $100 per year or $10 per month, based on the applicant’s credit history
  • Bond Amount: Determined on a case-by-case basis (more on this later)
  • Who Needs it: Postsecondary educational institutions operating in Alaska
  • Purpose: To ensure that students and their parents/guardians receive compensation for financial harm if the institution in any way defrauds them of tuition money
  • Who Regulates Postsecondary Educational Institutions in Alaska: Alaska Commission on Postsecondary Education (CPE)
Alaska Educational Institution Surety Bond Form
Alaska Educational Institution Surety Bond Form


Alaska Statute 14.48.020 requires all postsecondary education institutions operating in the state to obtain an authorization from the CPE. The Alaska legislature enacted the authorization required to ensure that postsecondary educational institutions engage in ethical business practices. To provide financial security for the enforcement of the authorization requirement, postsecondary educational institutions must purchase and maintain a surety bond to be eligible for authorization.

What is the Purpose of the Alaska Educational Institution Bond?

Alaska requires postsecondary educational institutions to purchase a surety bond as part of the application process to obtain a CPE authorization. The bond protects the public in the event the institution fails to abide by the regulations set forth in Alaska Municipal Code 14.48.100. Specifically, the bond protects the public in the event the institution engages in any acts of fraud or fails to refund tuition that has been paid but not earned. In short, the bond acts as a type of insurance that protects the public if the postsecondary educational institution violates the terms of its CPE authorization.

How Can an Insurance Agent Obtain an Alaska Educational Institution Surety Bond?

BondExchange makes obtaining an Alaska Educational Institution bond easy. Simply log in to your account and use our keyword search to find the “Educational” bond in our database. Don’t have a login? Gain access 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.

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How is the Bond Amount Determined?

Alaska Statute 14.48.100 grants the CPE the authority to determine the required bond amount on a case-by-case basis. When making their determinations, the CPE will consider how many students the institution is expected to enroll.

Is a Credit Check Required for the Alaska Educational Institution Bond?

Surety companies will run a credit check on the owners of the postsecondary educational institution to determine eligibility and pricing for the Alaska Educational Institution bond. Owners with excellent credit and work experience can expect to receive the best rates. Owners with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the owner’s credit.

How Much Does the Alaska Educational Institution Bond Cost?

The Alaska Educational Institution surety can cost anywhere between 1.5% to 7.5% of the bond amount per year. Insurance companies determine the rate based on several factors, including your customer’s credit score and experience. BondExchange also offers monthly pay-as-you-go options for these bonds. The chart below offers a quick reference for the approximate bond cost on a $10,000 bond requirement.

$10,000 Educational Institution Bond Cost

Credit Score Bond Cost (1 year) Bond Cost (1 month)
800+ $150 $15
650 – 799 $200 $20
600 – 649 $400 $40
550 – 599 $750 $75

*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.

Who is Required to Purchase the Bond?

Alaska requires postsecondary educational institutions to purchase a surety bond as a prerequisite to obtaining a CPE authorization. To paraphrase Alaska Statute 14.48.210, a postsecondary education institution is a school, college, or university that provides educational and/or training services to persons that have either completed or dropped out of high school.

Exemptions to the authorization and bonding requirements include:

  • Institutions providing instructions for grades K-12
  • Programs operated by the government agencies
  • Programs that do not provide educational credentials but rather prepare students to take graduate exams
  • Programs that are strictly avocational or recreational in nature
  • Programs that are in fields that:
    • Do not require professional licenses
    • Provide training for recreational purposes
    • Prepare enrollees to teach in the fields
  • Programs offered by professional or fraternal organizations that are required for membership into the organization
  • Programs that do not require fees
  • Programs that do not offer education credentials
  • Short courses that last only 15 days or 120 hours in duration
  • Programs offered by out-of-state institutions that are authorized by their own states

Alaska Educational Institution Surety Bond

BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.

How Do Postsecondary Educational Institutions Apply for Authorization in Alaska?

Postsecondary educational institutions must navigate several steps to become authorized. Below are the general guidelines, but applicants should refer to the authorization statutes, as well as the CPE’s website, for details on the process.

Step 1 – Meet the Minimum Standards

Alaska will only issue authorizations to organizations that meet all of the following criteria:

    • The quality of each course or program is high enough to adequately achieve its stated objective
    • The institution has access to adequate space, equipment, instructional materials, and personnel
    • All directors, administrators, supervisors, and instructors have the necessary qualifications to adequately fulfill their roles
    • The institution provides a catalog or brochure to prospective students containing all necessary information they need to make an informed decision to enroll
    • Students are given appropriate educational credentials after completing the course or program
    • The institution maintains records showing the attendance, progress, or grades, of all students as well as records showing that the appropriate standards are being enforced
    • The institution is in compliance with all pertinent ordinances and laws relating to the safety and health of persons on its premises
    • The institution is financially sound and capable of fulfilling its commitments to students
    • Neither the institution nor its agents engage in deceptive practices
    • All owners and staff are of good character
    • All student housing is appropriate, safe, and adequate
    • The institution has a fair and equitable cancellation and refund policy
    • The charges set by the institution for tuition, fees, books, and supplies are fair and equitable; and
    • The institution accepts military education, training, or service credit or hours toward a degree or prgram if
      • The institution accepts transfer credits or hours; and
      • The credit or hours transfer process meets the requirements of the accrediting body of the institution or the commission

Step 2 – Request an Application

Institutions that satisfy the above criteria are eligible to apply for authorization. To request an initial application, institutions must request an application by emailing [email protected].

Step 3 – Complete the Application

Postsecondary educational institutions should mail their completed applications, including all required fees, to the following address:

P.O. Box 110505
Juneau, AK, 99811-0505

Step 4 – Pass Inspection

After receiving the institution’s application, the CPE may require an on-site visit of the institution’s facilities. The CPE will evaluate the facility to ensure it complies with its standards. After the site visit is complete, the CPE will either grant or deny the institution’s authorization request at their next quarterly meeting.

Step 5 – Purchase a Surety Bond

After approving the institution’s application, the CPE will inform them of their required bond amount.

How do Alaska Postsecondary Educational Institutions Renew Their Authorizations?

The CPE will send the institution instructions on how to renew their authorization before the expiration date. Institutions must pay a renewal fee equal to 3% of the average tuition receipts during the most recent authorization period. However, the renewal fee may not be less than $500 or greater than $2,500.

What are the Insurance Requirements for the Alaska CPE Authorization?

Alaska does not require post-secondary educational institutions to purchase any form of liability insurance as a prerequisite to obtaining authorization. However, most institutions will purchase this insurance anyway. Postsecondary educational institutions must purchase and maintain a surety bond.

How do Alaska Postsecondary Educational Institutions File Their Bonds?

Postsecondary educational institutions should mail their completed bonds form, including the power of attorney, to the following address:

P.O. Box 110505
Juneau, AK, 99811-0505

The bond requires signatures from both the surety company that issues the bond and from the institution. 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 and address
  • Date the bond goes into effect
  • Date the bond is signed

What Can Alaska Postsecondary Educational Institutions Do to Avoid Claims Against Their Bonds?

To avoid claims on their bonds, post-secondary educational institutions in Alaska must follow all regulations outlined in Alaska Statute 14.48, including some of the most critical issues below that tend to cause a claim:

  • Do not engage in any acts of fraud
  • Refund all tuition that has been paid for but earned
  • Pay out all court judgments

What Other Insurance Products Can Agents Offer Postsecondary Educational Institutions in Alaska?

Most reputable postsecondary educational institutions will purchase liability insurance. 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 Alaska Postsecondary Educational Institution Customers?

Alaska conveniently provides a public database of active postsecondary educational institutions in the state. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.


Alaska Educational Institution Bond