How to Get a Lottery Retailer License in North Carolina

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 North Carolina. 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?

You must obtain a license from the North Carolina Education Lottery (NCEL) before you can sell lottery tickets in your North Carolina retail establishment.

What Are the Steps in the Licensing Process?

The application packet, instructions for completing it, and a helpful checklist are available for download from the NCEL website. Complete the application in its entirety, and submit it with the necessary supporting documents and your payment of the $75 application fee. 

NCEL will review your application and conduct the background checks authorized by your signature on the application. A physical site inspection is also required to determine your establishment’s compliance with the Americans with Disabilities Act (ADA).

Any concerns about your level of financial responsibility may result in you having to purchase a North Carolina lottery agent bond as a prerequisite for licensure. NCEL will inform you of the required bond amount.

Why Is a Surety Bond Required?

NCEL requires a surety bond when there are concerns about a lottery retailer’s financial strength and stability and the possibility of statutory infractions, such as not remitting the proceeds from lottery sales or falsifying sales records.

 A North Carolina lottery bond provides two levels of financial protection for NCEL (the “obligee” requiring the bond) and the public through the lottery retailer’s guarantee to:

  • Comply with all applicable Lottery laws and regulations and the terms of the Lottery Retailer contract, and
  • Compensate those who are financially harmed by the unlawful or unethical actions of the lottery retailer (the bond’s “principal”).

After two years, NCEL will conduct another investigation and decide whether a bond is still required.

How Do They Work?

A North Carolina lottery bond is legally binding on the bond’s obligee and principal and a third party—the bond’s guarantor (the “surety”). Upon receipt of a claim, the surety will investigate to determine its legitimacy. If the claim is valid, the principal is legally obligated to pay it.

However, having guaranteed the payment of claims, the surety will pay a valid claim on the principal’s behalf, which creates a debt the principal must repay to the surety. Failing to repay that debt can result in the surety suing the principal to recover the claim amount (plus legal fees and court costs).

What Do They Cost?

Multiplying the required bond amount established by the obligee and the premium rate resulting from an underwriting assessment of the risk to the surety gives you the annual premium for the bond. The underwriters measure the risk of the surety not being repaid for claims paid on the principal’s behalf based largely on the principal’s personal credit score. 

Someone with a high credit score has demonstrated financial responsibility and therefore is considered a low risk to the surety, so the premium rate will be low, potentially less than one percent. Conversely, someone with a lower credit score is viewed as a greater risk, so the premium rate will be higher.

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NORTH CAROLINA LOTTERY BOND QUOTE

Who Licenses Lottery Retailers?

You must obtain a license from the North Carolina Education Lottery (NCEL) before you can sell lottery tickets in your North Carolina retail establishment.

The application packet, instructions for completing it, and a helpful checklist are available for download from the NCEL website. Complete the application in its entirety, and submit it with the necessary supporting documents and your payment of the $75 application fee. 

NCEL will review your application and conduct the background checks authorized by your signature on the application. A physical site inspection is also required to determine your establishment’s compliance with the Americans with Disabilities Act (ADA).

Any concerns about your level of financial responsibility may result in you having to purchase a North Carolina lottery agent bond as a prerequisite for licensure. NCEL will inform you of the required bond amount. 

NCEL requires a surety bond when there are concerns about a lottery retailer’s financial strength and stability and the possibility of statutory infractions, such as not remitting the proceeds from lottery sales or falsifying sales records.

 A North Carolina lottery bond provides two levels of financial protection for NCEL (the “obligee” requiring the bond) and the public through the lottery retailer’s guarantee to:

  • Comply with all applicable Lottery laws and regulations and the terms of the Lottery Retailer contract, and
  • Compensate those who are financially harmed by the unlawful or unethical actions of the lottery retailer (the bond’s “principal”).

After two years, NCEL will conduct another investigation and decide whether a bond is still required.

A North Carolina lottery bond is legally binding on the bond’s obligee and principal and a third party—the bond’s guarantor (the “surety”). Upon receipt of a claim, the surety will investigate to determine its legitimacy. If the claim is valid, the principal is legally obligated to pay it.

However, having guaranteed the payment of claims, the surety will pay a valid claim on the principal’s behalf, which creates a debt the principal must repay to the surety. Failing to repay that debt can result in the surety suing the principal to recover the claim amount (plus legal fees and court costs).

Multiplying the required bond amount established by the obligee and the premium rate resulting from an underwriting assessment of the risk to the surety gives you the annual premium for the bond. The underwriters measure the risk of the surety not being repaid for claims paid on the principal’s behalf based largely on the principal’s personal credit score. 

Someone with a high credit score has demonstrated financial responsibility and therefore is considered a low risk to the surety, so the premium rate will be low, potentially less than one percent. Conversely, someone with a lower credit score is viewed as a greater risk, so the premium rate will be higher.

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