How to Get a Lottery Retailer License in Delaware

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about lottery retailer licensing in Delaware. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

 

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Who Licenses Lottery Retailers?

The Delaware Lottery licenses all retailers selling lottery products within the state. You must already have a business license issued by the Delaware Department of Revenue before applying for licensure as a lottery retailer.

What Are the Steps in the Licensing Process?

The licensing process begins when you submit a completed application to the Delaware Lottery. Once your application has been reviewed and found to be complete, a Delaware Lottery representative will visit your establishment and conduct a site inspection.

The review of your application and supporting documents will then continue. If there appear to be no impediments to granting you a license, you will be asked to authorize a criminal history check, and your establishment will undergo another inspection—this time for compliance with the Americans with Disabilities Act (ADA). You will be informed via email as to whether your application for licensure as a Delaware Lottery retailer has been approved or denied.

If you do not meet the state’s financial responsibility standards, you may be required to furnish the Delaware Lottery with a surety bond in an amount established by the Lottery Director.

Why Is a Surety Bond Required?

The purpose of a Delaware lottery bond is to prevent any monetary loss to the State resulting from your actions as a lottery retailer.

The terms of the bond require the licensed lottery retailer to do lottery business in accordance with all applicable Delaware laws and Delaware Lottery regulations, which provides a certain level of protection in a preventive sense. A Delaware lottery bond also gives the State the right to seek compensation for damages caused by the retailer’s unlawful or unethical actions.

How Do They Work?

The surety bond forms a legally binding contract among three parties: the obligee requiring the bond (The Delaware Lottery), the principal purchasing the bond (the lottery retailer), and the surety guaranteeing the bond. The surety guarantees the payment of claims by agreeing to extend credit to the principal if needed for the purpose of paying a valid claim. However, the legal obligation to pay all valid claims rests entirely with the principal. The surety determines which claims are valid and must be paid.

Unless the principal pays a valid claim immediately, the normal practice is for the surety to pay it on the principal’s behalf, using the line of credit established for the principal. That payment creates a debt that the principal must repay to the surety. Not repaying that debt can result in the surety taking legal action to recover the funds.

What Do They Cost?

To purchase a Delaware lottery bond, the principal pays an annual premium that is calculated by multiplying the required bond amount by the premium rate, which is assigned by the surety through underwriting. The main underwriting concern is the risk that the principal won’t repay the surety for claims paid on the principal’s behalf. That risk is measured largely on the basis of the principal’s personal credit score.

A high credit score assures the surety that the risk is low, which should result in a low premium rate, potentially as low as 1%. A lower credit score is a sign of higher risk and results in a higher premium rate.

 

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about lottery retailer licensing in Delaware. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

CONTACT US FOR A

DELAWARE LOTTERY BOND QUOTE

Who Licenses Lottery Retailers?

The Delaware Lottery licenses all retailers selling lottery products within the state. You must already have a business license issued by the Delaware Department of Revenue before applying for licensure as a lottery retailer.

The licensing process begins when you submit a completed application to the Delaware Lottery. Once your application has been reviewed and found to be complete, a Delaware Lottery representative will visit your establishment and conduct a site inspection.

The review of your application and supporting documents will then continue. If there appear to be no impediments to granting you a license, you will be asked to authorize a criminal history check, and your establishment will undergo another inspection—this time for compliance with the Americans with Disabilities Act (ADA). You will be informed via email as to whether your application for licensure as a Delaware Lottery retailer has been approved or denied.

If you do not meet the state’s financial responsibility standards, you may be required to furnish the Delaware Lottery with a surety bond in an amount established by the Lottery Director.

The purpose of a Delaware lottery bond is to prevent any monetary loss to the State resulting from your actions as a lottery retailer.

The terms of the bond require the licensed lottery retailer to do lottery business in accordance with all applicable Delaware laws and Delaware Lottery regulations, which provides a certain level of protection in a preventive sense. A Delaware lottery bond also gives the State the right to seek compensation for damages caused by the retailer’s unlawful or unethical actions.

The surety bond forms a legally binding contract among three parties: the obligee requiring the bond (The Delaware Lottery), the principal purchasing the bond (the lottery retailer), and the surety guaranteeing the bond. The surety guarantees the payment of claims by agreeing to extend credit to the principal if needed for the purpose of paying a valid claim. However, the legal obligation to pay all valid claims rests entirely with the principal. The surety determines which claims are valid and must be paid.

Unless the principal pays a valid claim immediately, the normal practice is for the surety to pay it on the principal’s behalf, using the line of credit established for the principal. That payment creates a debt that the principal must repay to the surety. Not repaying that debt can result in the surety taking legal action to recover the funds.

 

To purchase a Delaware lottery bond, the principal pays an annual premium that is calculated by multiplying the required bond amount by the premium rate, which is assigned by the surety through underwriting. The main underwriting concern is the risk that the principal won’t repay the surety for claims paid on the principal’s behalf. That risk is measured largely on the basis of the principal’s personal credit score.

A high credit score assures the surety that the risk is low, which should result in a low premium rate, potentially as low as 1%. A lower credit score is a sign of higher risk and results in a higher premium rate.

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