Pennsylvania Auctioneer Bond: A Comprehensive Guide

August 31, 2022

Pennsylvania Auctioneer Bond

This guide provides information for insurance agents to help their customers obtain a Pennsylvania Auctioneer bond.

At a Glance:

  • Average Cost: $100 per year
  • Bond Amount: $5,000
  • Who Needs it: All auctioneers and auction companies operating in Pennsylvania
  • Purpose: To ensure the public is compensated for damages if the auctioneer fails to comply with licensing law
  • Who Regulates Auctioneers in Pennsylvania: The Pennsylvania State Board of Auctioneer Examiners

Background

The Pennsylvania Auctioneer Licensing and Trading Assistant Registration Act requires all auctioneers, apprentice auctioneers, auction companies, trading assistants, trading assistant companies, and out-of-state auctioneers operating in the state to obtain a license from the Pennsylvania State Board of Auctioneer Examiners. The state legislature enacted the licensing laws and regulations to ensure that auctioneers engage in ethical business practices. To provide financial security for the enforcement of the licensing law, applicants must purchase and maintain a $5,000 surety bond to be eligible for licensure.

*Trading assistants and trading assistant companies are required to register with the State Board of Auctioneer Examiners. For the purposes of this article, we will refer to the registration as a business license.

What is the Purpose of the Pennsylvania Auctioneer Bond?

Pennsylvania requires all persons engaged in the business of auctioneering to purchase a surety bond as part of the application process to obtain a business license. The bond protects the public from financial harm if the auctioneer fails to comply with the regulations set forth in Pennsylvania Statute 734.7. Specifically, the bond protects the public in the event the auctioneer commits fraud or breaches consumer contracts. In short, the bond is a type of insurance that protects the public if the auctioneer violates the terms of their license.

Pennsylvania Auctioneer Bond Form

How Can an Insurance Agent Obtain a Pennsylvania Auctioneer Surety Bond?

BondExchange makes obtaining a Pennsylvania Auctioneer bond easy. Simply login 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 (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 Pennsylvania Auctioneer Bond?

A credit check is not required for the Pennsylvania Auctioneer bond. Because the bond is considered relatively low risk, the same low rate is offered to all auctioneers operating in the state regardless of their credit history.

How Much Does the Pennsylvania Auctioneer Bond Cost?

The Pennsylvania Auctioneer bond costs just $100 per year.

Who is Required to Purchase the Bond?

Pennsylvania requires all auctioneers, apprentice auctioneers, auction companies, trading assistants, trading assistant companies, and out-of-state auctioneers to purchase a surety bond as a prerequisite to obtaining a business license. Pennsylvania Statute 734.2 defines the above terms as follows:

  • Auctioneer: Any individual who sells or offers property to the highest bidder at auction.
  • Apprentice Auctioneer: An auctioneer in training who is operating under the supervision of a licensed auctioneer.
  • Auction Company: A legally recognized entity engaged in selling property at auction.
  • Trading Assistant: An individual who sells another individual’s personal property exclusively on an online platform
  • Trading Assistant Company: A legally recognized entity that sells another individual’s personal property on an online platform
  • Out-of-State Auctioneer: Any auctioneer authorized to conduct business in another state seeking to do business in Pennsylvania

Exemptions to this requirement include:

  • Individuals selling their own property
  • Sales made on behalf of the court or government
  • Sales made at auctions required by law
  • Sales made in the settlement of an estate or trust
  • Charitable or non-profit organizations

How Do Auctioneers Apply for a License in Pennsylvania?

Auctioneers in Pennsylvania must navigate several steps to secure their licenses. Below are the general guidelines, but applicants should refer to the State Board of Auctioneer Examiner’s licensing page for details on the process.

License Period – All Pennsylvania Auctioneer Licenses expire on February 28 of every odd-numbered year (2023, 2025, etc.).

All applicants are required to register an account on the PALS website before applying for a license. Individual auctioneers must undergo a criminal history records check and will be charged additional fees that will be automatically processed after submitting their applications.

Apprentice Auctioneers

Step 1 – Obtain a Sponsorship

All apprentice auctioneers in Pennsylvania must be sponsored and employed by a licensed auctioneer.

Step 2 – Purchase a Surety Bond

Apprentice auctioneers are required to purchase and maintain a $5,000 surety bond.

Step 3 – Complete the Application

All Pennsylvania Apprentice Auctioneer License applications should be submitted online here. Apprentices must complete the application in its entirety, and submit the following items:

    • Surety Bond
    • $30 application fee
    • A copy of the applicant’s work permit (for minors only)

Auctioneers

Step 1 – Meet the Experience Requirements

To become a licensed auctioneer in Pennsylvania, applicants must ensure that they have completed one of the following:

    • Serve as a licensed apprentice auctioneer for at least two years and participate in a minimum of 30 auctions
    • Serve as a licensed apprentice auctioneer for at least one year and participate in a minimum of 15 auctions along with completing up to 20 credit hours at an approved auctioneering school
    • Successfully complete at least 20 credit hours at an approved auctioneering school, including two hours of practicum or practical experience
    • Be a licensed auctioneer in good standing in another state for at least two years
    • Have conducted auctioneering for at least two years in a state that does not require a license

Step 2 – Pass the Exam

Auctioneers are required to pass an exam administered by a third-party testing organization before being issued their license. To take the exam, applicants must submit an application online here and pay the required exam fees directly to the testing organization. Contact the State Board of Auctioneer Examiners for more information on the examination process.

Step 3 – Purchase a Surety Bond

Auctioneers are required to purchase and maintain a $5,000 surety bond.

Step 4 – Complete the Application

Auctioneers can apply for licensure after passing the required exam. All Pennsylvania Auctioneer License applications should be submitted online here.  Auctioneers must complete the application in its entirety, and submit the following items:

    • Surety Bond
    • $50 application fee
    • Employing auctioneer data and a list of all auctions conducted
    • Exam results sent directly from the testing organization
    • Official transcript from college or university (if applicable)

Auction Company

Step 1 – Designate an Auctioneer-of-Record

Auction companies should designate a member of the company to serve as the company’s auctioneer-of-record. This individual must be licensed as an auctioneer and will be responsible for ensuring that all auctions are held in accordance with the law.

Step 2 – Purchase a Surety Bond

Auction companies must purchase and maintain a $5,000 surety bond.

Step 3 – Complete the Application

All Pennsylvania Auction Company License applications should be submitted online here. The auction company must complete the application in its entirety, and submit the following items:

    • Company formation documents
    • Fictitious name registration (if applicable)
    • $50 application fee

Trading Assistant/Companies

Step 1 – Purchase a Surety Bond

Trading assistants and trading assistant companies must purchase and maintain a $5,000 surety bond

Step 2 – Complete the Application

All Pennsylvania Trading Assistant and Trading Assistant Company License applications should be submitted online here. The trading assistant/company must complete the application in its entirety, and submit the following items:

    • $100 application fee
    • Surety Bond
    • For trading assistant companies only:
      • Company formation documents
      • Fictitious name registration (if applicable)

Special Licenses for Out-of-State Auctioneers/Companies

Step 1 – Meet the Experience Requirements

Pennsylvania issues special licenses to out-of-state auctioneers and auction companies seeking to conduct a single auction. To be eligible for licensure, out-of-state auctioneers and auction companies must be licensed as an auctioneer/auction company in another state

Step 2 – Purchase a Surety Bond

Out-of-state auctioneers and auction companies must purchase and maintain a $5,000 surety bond.

Step 3 – Complete the Application

All Pennsylvania Special License applications should be submitted online here. Out-of-state auctioneers and companies must complete the application in its entirety, and submit the following items:

    • Current Original Certification Letter from out-of-state licensing board
    • Name and address of the seller or owner of all items being sold

All Special License applications must be submitted to the Board at least 20 days in advance of the auction.

How do Pennsylvania Auctioneers Renew Their Licenses?

Approximately 60 days before the expiration date the Board of Auctioneer Examiners will send the licensee a renewal notice with instructions on how to renew their license. The renewal fees for each license are as follows:

  • Apprentice Auctioneer License: $130
  • Auctioneer License: $260
  • Auction Company License: $260
  • Trading Assistant License: $100
  • Trading Assistant Company License: $100

All Pennsylvania Auctioneer licenses expire on February 28 of every odd-numbered year (2023, 2025, etc.). Out-of-state auctioneers and companies with special licenses are unable to renew their licenses. Their licenses may be valid for two years, but that simply means they have two years to conduct an auction before their license expires.

What are the Insurance Requirements for Auctioneers in Pennsylvania?

Pennsylvania does not require auctioneers to purchase any form of liability insurance as a prerequisite to obtaining a state license. All auctioneers, apprentice auctioneers, auction companies, trading assistants/companies, and out-of-state auctioneers/companies must purchase and maintain a $5,000 surety bond.

How Do Pennsylvania Auctioneers File Their Bonds?

All auctioneers should mail their completed bond forms, including the power of attorney, to the following address:

State Board of Auctioneer Examiners
P.O. Box 2469
Harrisburg, PA 17105

The bond requires signatures, including witness 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, address, and business structure of the entity/individual(s) buying the bond
  • Surety company’s name and address
  • Type of license applied for
  • Date the bond is signed

Out-of-state auctioneers and auction companies are required to submit an additional consent form when filing their bond.

What Can Pennsylvania Auctioneers do to Avoid Claims Made Against Their Bonds?

To avoid claims on their bonds, auctioneers in Pennsylvania 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
  • Adhere to all consumer contracts

What Other Insurance Products Can Agents Offer Auctioneers in Pennsylvania?

Pennsylvania does not require auctioneers to purchase any form of liability insurance as a prerequisite to obtaining a state license. However, most reputable auctioneers will purchase this insurance anyway. 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 Pennsylvania Auctioneer Customers?

Pennsylvania conveniently provides a public database to search for active auctioneers in the state. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.

2022-09-01T15:04:22-04:00