What is ARC Surety Bond?
An ARC Surety Bond is a type of financial guarantee required by the Airlines Reporting Corporation (ARC) for travel agencies and other businesses that sell airline tickets. This bond protects the ARC and airline carriers from financial losses due to a travel agency's failure to remit payment or comply with ARC rules and regulations.
Who Needs It
Any travel agency or business that wants to be accredited by the ARC and issue airline tickets must obtain an ARC Surety Bond. This includes both brick-and-mortar agencies and online travel agencies. Without this bond, businesses cannot access the ARC system to book or manage airline ticket transactions.
What It Typically Covers
The ARC Surety Bond provides financial protection to the ARC by ensuring that the bonded business will fulfill its financial obligations. If a travel agency fails to comply with ARC’s terms—such as not paying for tickets sold or violating reporting rules—the ARC can file a claim against the bond to recover losses.
Common Exclusions and Limitations
This bond does not cover fraudulent activity or misrepresentation beyond the scope of compliance with ARC regulations. It is also limited to the bond amount set at the time of issuance. The bond does not protect the travel agency; it protects the ARC and its partners.
Factors That Influence Cost
Several factors impact the cost of an ARC Surety Bond, including:
- The amount of the bond required by ARC
- The financial stability and credit history of the business owner
- Business experience in the travel industry
Applicants with strong credit and financial records generally receive lower bond premiums.
Proof of Insurance & Compliance
Once issued, the ARC Surety Bond serves as proof that the travel agency meets ARC’s bonding requirements. Most states do not regulate this bond directly, but ARC sets specific bonding standards as part of its accreditation process. Businesses must maintain the bond continuously to stay in compliance and retain ARC accreditation.
How to Get a Quote
To obtain an ARC Surety Bond, you’ll need to apply through a licensed bond provider who understands ARC requirements. Be prepared to provide business financials and undergo a credit check.
Get a quote for your ARC Surety Bond today.
Frequently Asked Questions
Why does a travel agency need an ARC Surety Bond?
It’s required by the Airlines Reporting Corporation to ensure agencies meet financial and reporting obligations when selling airline tickets.
What happens if my ARC Surety Bond lapses?
If your bond expires or is canceled, your ARC accreditation may be suspended or revoked until a new bond is in place.
Can I get an ARC Surety Bond with bad credit?
It may be possible, but your premium will likely be higher. Some surety providers offer bond options for applicants with less-than-perfect credit.
Is the ARC Surety Bond refundable?
Generally, bond premiums are non-refundable once the bond is issued, even if it’s canceled early. Check with your provider for specific terms.
How long does it take to get an ARC Surety Bond?
Most applicants can get bonded within 1–3 business days, depending on their credit and the completeness of their application.
Still have questions? Talk to a local insurance expert.