Hawaii Escrow Depository Bond

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Hawaii Escrow Depository Bond: A Comprehensive Guide

This guide provides information for insurance agents to help their customers obtain a Hawaii Escrow Depository bond.

*This page focuses exclusively on the $100,000 license bond required for escrow depositories operating in Hawaii. Escrow depositories that are licensed as a business entity must also obtain a $100,000 Fidelity bond or similar insurance coverage. Contact BondExchange to obtain a Fidelity bond.

At a Glance:

  • Lowest Cost: $750 per year or $75 per month
  • Bond Amount: $100,000
  • Who Needs It: All escrow depository businesses operating in Hawaii
  • Purpose: To ensure the public will receive compensation for financial harm if the escrow depository fails to comply with licensing laws
  • Who Regulates Escrow Depository Businesses in Hawaii: The Hawaii Department of Commerce and Consumer Affairs
Hawaii Escrow Depository Bond Form
Hawaii Escrow Depository Bond Form


Hawaii Revised Statute 449-5 requires all escrow depository businesses operating in the state to obtain a license from the Department of Commerce and Consumer Affairs. The Hawaii legislature enacted the licensing requirement to ensure escrow depositories do not engage in unethical business practices. To provide financial security for enforcing licensing laws, escrow depositories must purchase and maintain a surety bond to be eligible for licensure.

What Is the Purpose of a Hawaii Escrow Depository Bond?

Escrow depository businesses that provide escrow and title services to the Hawaiian public must purchase a surety bond as part of the application process to obtain a business license. The bond protects the public from losses should the escrow depository fail to abide by the regulations outlined in Hawaii Revised Statute 449-9. Specifically, the bond financially protects claimants if a licensee misappropriates funds or commits fraud. In short, the bond is a type of insurance that protects the public if the escrow depository violates the terms of its license.

How Can an Insurance Agent Obtain a Hawaii Escrow Depository Bond?

BondExchange makes obtaining a Hawaii Escrow Depository bond easy. Simply log in to your account and use our keyword search to find the “escrow depository” 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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Is a Credit Check Required for the Hawaii Escrow Depository Bond?

Surety companies will run a credit check on the applicants to determine eligibility and pricing for the Hawaii Escrow Depository bond. Escrow depositories with excellent credit and work experience can expect to receive the best rates, while escrow depositories with poor credit may be declined by some surety companies or have to pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the applicant’s credit.

How Much Does the Hawaii Escrow Depository Bond Cost?

The Hawaii Escrow Depository bond can cost between $750 to $7,000 per year or $75 to $700 per month. Monthly subscription options are also available. Insurance companies determine the rate based on several factors including your customer’s credit score and experience. The chart below briefly references the approximate bond cost on the $100,000 bond requirement.

$100,000 Hawaii Escrow Depository Bond Cost

Credit Score* Bond Cost (1 Year) Bond Cost (1 month)
720+ $750 $75
625 – 719 $1,000 $100
600 – 624 $2,500 $250
575 – 559 $3,000 $300
550 – 574 $5,000 $500
500 – 549 $7,000 $700

*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.

How Does Hawaii Define “Escrow Depository”?

To paraphrase Hawaii Revised Statute 449-1, an escrow depository is a business that receives, holds, and delivers the payment for property titles during the escrow period. For example, an escrow depository may hold onto a buyer’s down payment while a home is in escrow. Once all the financials and various paperwork have been cleared for the purchase of the home, the licensee is cleared to transfer the down payment over to the seller.

Exemptions to this definition include the following:

  • Banks, trust companies, and savings/loan associations
  • Licensed real estate broker that does not charge an escrow fee
  • Any person licensed to practice law in Hawaii

Hawaii Escrow Depository 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 Escrow Depositories Apply for a License in Hawaii?

Escrow depository businesses in Hawaii must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the Department of Commerce and Consumer Affairs Escrow Depositories webpage for specific details on the process.

License PeriodA escrow depository license under the regulation of the Hawaii Department of Commerce and Consumer Affairs expires on December 31st annually.

Step 1 – Fulfill Financial Requirements

Escrow depository businesses are required to purchase and maintain a $100,000 surety bond, a $100,000 Fidelity bond*, and a $250,000 Errors and Omissions policy*.

*With permission from the Hawaii Department of Commerce and Consumer Affairs, an equivalent cash deposit is also acceptable.

Step 2 – Complete the Application

The escrow depository license application must be submitted electronically to the NMLS. The application should contain the following:

  • Corporate name, amount of capital, and office address of the applicant
  • Names of the stockholders, officers, and directors of the applicant
  • Evidence of the character, financial responsibility, experience, and ability of the officers and directors
  • Names of the proposed escrow officers and their qualifications
  • Criminal history of the applicant
  • Non-refundable filing fee for the application

Further details can be found on the NMLS license checklist.

How Do Hawaii Escrow Depository Businesses Renew Their License?

The escrow depository license must be renewed through the NMLS before December 31st of each year.

What Are the Insurance Requirements for Escrow Depository Businesses in Hawaii?

According to Hawaii Revised Statutes 449-11 and 449-12, the escrow depository must purchase and maintain a $100,000 Fidelity bond and a $250,000 E&O policy. However, the Hawaii Department of Commerce and Consumer Affairs will also accept an equivalent cash deposit in place of each requirement.

How Do Hawaii Escrow Depository Businesses File Their Bonds?

Escrow depositories should submit their completed bond forms, including the power of attorney, electronically through the NMLS. The surety bond requires signatures from the surety company, as well as a representative from the escrow depository business. The surety company should include the following information on the bond form:

  • The legal name of the individual buying the bond
  • Surety company’s name 
  • Date the bond is signed

What Can Hawaii Escrow Depository Businesses Do to Avoid a Claim Against Their Surety Bond?

The best way to avoid a bond claim as an escrow depository is to simply comply with state license laws. This includes holding and depositing all funds received honestly, as well as properly performing each escrow obligation. For example, acting without consent from a buyer or seller is a blatant breach of contract and is subject to a bond claim.

What Other Insurance Products Can Agents Offer Escrow Depository Businesses in Hawaii?

The Hawaii Department of Commerce and Consumer Affairs requires escrow depository businesses to purchase coverage for a $250,000 Errors and Omissions policy, which is just another name for professional 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 Hawaii Escrow Depository Customers?

Hawaii conveniently provides a public database via the NMLS to search for active escrow depository businesses 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.

Hawaii Escrow Depository Bond