North Carolina Private Barber School Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a North Carolina Private Barber School bond
At a Glance:
- Lowest Cost: $100 per year or $10 per month
- Bond Amount: Minimum of $10,000 (more on this later)
- Who Needs it: All private barber schools operating in North Carolina
- Purpose: To ensure that students will receive compensation for financial harm if the school fails to provide all services that have been paid for
- Who Regulates Private Barber Schools in North Carolina: The North Carolina Board of Barber Examiners
Background
North Carolina Statute 86A-22 requires all private barber schools operating in the state to obtain a license from the Board of Barber Examiners. The North Carolina legislature enacted the licensing requirement to ensure that private barber schools engage in ethical business practices and are qualified to provide instruction. To provide financial security for the enforcement of the licensing law, private barber schools must purchase and maintain a surety bond to be eligible for licensure.
What is the Purpose of the North Carolina Private Barber School Bond?
North Carolina requires private barber schools to purchase a surety bond as part of the application process to obtain a business license. The bond ensures that students will receive compensation for financial harm if the school fails to comply with the regulations outlined in North Carolina Statute 86A-22. Specifically, the bond protects students if the school breaches any contracts made with them or fails to provide refunds for services that have been paid for but not received. In short, the bond is a type of insurance that protects students if the private barber school violates the terms of its license.
How Can an Insurance Agent Obtain a North Carolina Private Barber School Surety Bond?
BondExchange makes obtaining a North Carolina Private Barber School bond easy. Simply login to your account and use our keyword search to find the “Barber School” 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 (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?
North Carolina Statute 86A-22 dictates that the bond amount must be equal to the maximum amount of prepaid tuition held at any point during the past fiscal year or $10,000, whichever is greater.
Is a Credit Check Required for the North Carolina Private Barber School Bond?
Surety companies will run a credit check on the owners of the school to determine eligibility and pricing for the North Carolina Private Barber School 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 North Carolina Private Barber School Bond Cost?
The North Carolina Private Barber School bond can cost anywhere between 1% to 12.5% of the bond amount per year. Insurance companies determine the rate based on several factors including your customer’s credit score and experience. The chart below offers a quick reference for the cost of a $10,000 bond requirement.
$10,000 Private Barber School Bond Cost
| Credit Score | Bond Cost (1 year) | Bond Cost (1 month) |
|---|---|---|
| 720+ | $100 | $10 |
| 680 – 719 | $150 | $15 |
| 650 – 679 | $200 | $20 |
| 600 – 649 | $400 | $40 |
| 550 – 599 | $750 | $75 |
| 500 – 549 | $1,250 | $125 |
*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?
North Carolina requires all privately owned barber schools to purchase a surety bond as a prerequisite to obtaining a business license. To paraphrase North Carolina Statute 86A-22, a barber school is a business that, in exchange for compensation, trains students on how to cut, trim, and style hair and beards.
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 North Carolina Private Barber Schools Apply for a License?
Private barber schools in North Carolina must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the licensing statutes and the school manual for details on the process.
License Period – All North Carolina Barber School Licenses expire on May 31 of each year and must be renewed before the expiration date
Step 1 – Contact the Board of Barber Examiners
The Board of Barber Examiners highly recommends that prospective barber schools contact them before applying for a license. The board will walk the school through the application process and answer any questions they may have.
Step 2 – Meet the Eligibility Requirements
All North Carolina Barber Schools must meet all of the following requirements to be eligible for licensure:
-
- Provide a course of instruction of at least 1,528 hours
- Employ two instructors for the first 40 students, and one instructor for each additional 20 students (tax-exempt schools must employ at least one instructor per 20 students)
- Require all students to obtain a permit before starting instruction
- Provide a complete course of instruction on all required topics
- Comply with all sanitary requirements
Step 3 – Purchase a Surety Bond
Private barber schools must purchase and maintain a surety bond (limits outlined above)
Step 4 – Complete the Application
All North Carolina Barber School License applications should be mailed to the following address:
North Carolina Board of Barber Examiners
7001 Mail Service Center
Raleigh, North Carolina 27699-7000
Schools must complete the application in its entirety and pay the following fees:
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- $130 license fee
- $220 inspection fee
Step 5 – Pass Inspection
After reviewing the school’s application, the board will schedule a time to inspect their proposed place of business. Schools must pass the inspection before receiving their licenses.
How do North Carolina Private Barber Shops Renew Their Licenses?
Barber schools should renew their licenses online here. All North Carolina Barber School Licenses expire on May 31 of each year and must be renewed before the expiration date.
What are the Insurance Requirements for Private Barber Schools in North Carolina?
North Carolina does not require private barber schools to purchase any form of liability insurance as a prerequisite to obtaining a business license. Private barber schools must purchase and maintain a surety bond (limits outlined above)
How Do North Carolina Private Barber Schools File Their Bonds?
Private barber schools should file their completed bond forms, including the power of attorney, with the superior court of the county the school will be located in. Additionally, schools must submit a copy of their bond to the Board of Barber Examiners at the following address:
North Carolina Board of Barber Examiners
7001 Mail Service Center
Raleigh, North Carolina 27699-7000
The surety bond requires signatures from both the surety company that issues the bond and the applicant. The surety company should include the following information on the bond form:
- Legal name and address of the entity/individual(s) buying the bond
- Surety company’s name and address
- Date the bond is signed
What Can North Carolina Private Barber Schools do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, private barber schools in North Carolina must follow all license regulations in the state, including some of the most important issues below that tend to cause claims:
- Do not breach any contracts made with consumers
- Issue refunds for all services that have been paid for but not received
What Other Insurance Products Can Agents Offer Private Barber Schools in North Carolina?
Most reputable private barber schools will purchase liability insurance. Bonds are our only business at BondExchange, so we do not issue any other types of 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 North Carolina Private Barber School Customers?
North Carolina conveniently provides a public database of active barber schools in the state. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.