How to Become a Lottery Retailer in North Dakota

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 Dakota. 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?

In North Dakota, lottery retailers must be licensed by the Lottery Division of the Attorney General’s Office.

 

What Are the Steps in the Licensing Process?

The application for a North Dakota lottery retailer license can be downloaded from the “For Retailers” page of the Lottery website. Select “Application and Licensing” to access the application and related forms, as well as the instructions for completing them. In signing the application, you are consenting to both a criminal records check and a credit check.

After filling out all forms in their entirety, return them to the address provided on the application, along with payment of the required application fee and criminal records check fee. If the Lottery Director has any concerns about your financial stability, you may also be required to purchase a lottery agent bond in an amount determined by the Director.

Why Is a Surety Bond Required?

When a lottery bond is required, it’s because the results of the applicant’s credit check and review of the application have raised some concerns about the applicant’s financial status and the possibility of that having a negative financial impact on the North Dakota Lottery.

In purchasing a lottery bond, a lottery retailer is pledging to abide by all applicable statutes and lottery rules and the terms of the Lottery Agreement that must be signed upon approval of the retailer’s license. These all help ensure that the retailer will not engage in any conduct that could cause a monetary loss by the Lottery. But if the retailer does commit a violation that causes the Lottery financial harm (misappropriating lottery funds or failure to remit lottery sales proceeds to the state), the bond can provide compensation for the damages.

How Do They Work?

There are three parties to a North Dakota lottery bond: 1) the North Dakota Lottery (the “obligee” requiring the bond), 2) the lottery retailer (the “principal” purchasing the bond), and 3) the bond’s guarantor (the “surety”).

Upon receipt of a claim, the surety will conduct an investigation to determine whether it is legitimate and perhaps attempt to negotiate a settlement. The principal is legally obligated to pay all valid claims that can’t be settled amicably. The surety guarantees that payment and has agreed to extend credit to the principal for the purpose of paying claims, if necessary.

Because of that guarantee, the surety typically will pay a claim on the principal’s behalf to expedite resolution of the claim. That payment is, in effect, a loan from the principal to the surety—a loan that the surety is legally obligated to repay. If the loan is not repaid, the surety can take legal action against the principal to recover the funds.

What Do They Cost?

North Dakota lottery bonds, like nearly all surety bonds, are sold for an annual premium. The premium amount is calculated by multiplying two factors: the required bond amount set by the obligee and the premium rate assigned by the surety through an underwriting risk assessment.

The primary underwriting concern is the possibility of the surety not being repaid by the principal for claims paid on the principal’s behalf and having to pursue the matter in court. That risk is measured largely on the basis of the principal’s personal credit score, which is a good benchmark for financial responsibility.

A high credit score suggests a low risk to the surety and results in a premium rate as low as 1% or even less. However, a low credit score signals a higher risk level 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 North Dakota. 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

NORTH DAKOTA LOTTERY BOND QUOTE

Who Licenses Lottery Retailers?

In North Dakota, lottery retailers must be licensed by the Lottery Division of the Attorney General’s Office.

The application for a North Dakota lottery retailer license can be downloaded from the “For Retailers” page of the Lottery website. Select “Application and Licensing” to access the application and related forms, as well as the instructions for completing them. In signing the application, you are consenting to both a criminal records check and a credit check.

After filling out all forms in their entirety, return them to the address provided on the application, along with payment of the required application fee and criminal records check fee. If the Lottery Director has any concerns about your financial stability, you may also be required to purchase a lottery agent bond in an amount determined by the Director.

When a lottery bond is required, it’s because the results of the applicant’s credit check and review of the application have raised some concerns about the applicant’s financial status and the possibility of that having a negative financial impact on the North Dakota Lottery.

In purchasing a lottery bond, a lottery retailer is pledging to abide by all applicable statutes and lottery rules and the terms of the Lottery Agreement that must be signed upon approval of the retailer’s license. These all help ensure that the retailer will not engage in any conduct that could cause a monetary loss by the Lottery. But if the retailer does commit a violation that causes the Lottery financial harm (misappropriating lottery funds or failure to remit lottery sales proceeds to the state), the bond can provide compensation for the damages.

There are three parties to a North Dakota lottery bond: 1) the North Dakota Lottery (the “obligee” requiring the bond), 2) the lottery retailer (the “principal” purchasing the bond), and 3) the bond’s guarantor (the “surety”).

Upon receipt of a claim, the surety will conduct an investigation to determine whether it is legitimate and perhaps attempt to negotiate a settlement. The principal is legally obligated to pay all valid claims that can’t be settled amicably. The surety guarantees that payment and has agreed to extend credit to the principal for the purpose of paying claims, if necessary.

Because of that guarantee, the surety typically will pay a claim on the principal’s behalf to expedite resolution of the claim. That payment is, in effect, a loan from the principal to the surety—a loan that the surety is legally obligated to repay. If the loan is not repaid, the surety can take legal action against the principal to recover the funds.

 

There are three parties to a North Dakota lottery bond: 1) the North Dakota Lottery (the “obligee” requiring the bond), 2) the lottery retailer (the “principal” purchasing the bond), and 3) the bond’s guarantor (the “surety”).

Upon receipt of a claim, the surety will conduct an investigation to determine whether it is legitimate and perhaps attempt to negotiate a settlement. The principal is legally obligated to pay all valid claims that can’t be settled amicably. The surety guarantees that payment and has agreed to extend credit to the principal for the purpose of paying claims, if necessary.

Because of that guarantee, the surety typically will pay a claim on the principal’s behalf to expedite resolution of the claim. That payment is, in effect, a loan from the principal to the surety—a loan that the surety is legally obligated to repay. If the loan is not repaid, the surety can take legal action against the principal to recover the funds.

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