Section 394.206 - Bond; Insurance(a) A provider shall, at the time the provider files an initial or renewal registration application with the commissioner, file:(2) evidence that the provider maintains an insurance policy in a form approved by the commissioner.(b) The bond or insurance must:(1) run concurrently with the period of registration;(2) be available to pay damages and penalties to consumers directly harmed by a violation of this subchapter;(3) be in favor of this state for the use of this state and the use of a person who has a cause of action under this subchapter against the provider;(4) if a bond: (A) be in an amount equal to the average daily balance of the provider's trust account serving Texas consumers over the six-month period preceding the issuance of the bond, or in the case of an initial application, in an amount determined by the commissioner, but not less than $25,000 or more than $100,000, if the provider receives and holds money paid by or on behalf of a consumer for disbursement to the consumer's creditors; or(B) be in the amount of $50,000, if the provider does not receive and hold money paid by or on behalf of a consumer for disbursement to the consumer's creditors;(5) if an insurance policy: (A) provide coverage for professional liability, employee dishonesty, depositor's forgery, and computer fraud in an amount not less than $100,000;(B) be issued by a company rated at least "A-" or its equivalent by a nationally recognized rating organization; and(C) provide for 30 days advance written notice of termination of the policy to be provided to the commissioner;(6) be issued by a bonding, surety, or insurance company that is authorized to do business in the state; and(7) be conditioned on the provider and its agents complying with all state and federal laws, including regulations, governing the business of debt management services.(c) In lieu of a bond or insurance, the finance commission by rule may establish alternative financial requirements to provide substantially equivalent protection to pay damages and penalties to consumers directly harmed by a violation under this subchapter.(d) The commissioner may adjust the amount of the provider's bond or insurance only when the provider applies for renewal of registration and requests a review of the bond or insurance amount.Amended By Acts 2011, 82nd Leg., R.S., Ch. 368, Sec. 3, eff. 9/1/2011.Added by Acts 2005, 79th Leg., Ch. 336, Sec. 1, eff. 9/1/2005.