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The Attorney General of Texas 

April 14, 1981 

MARK WHITE 

Attorney General 

IWO1 Mli” St.. suita 1402 

Dill... TX. 75201 

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505 sro5dw.y. sun. 212 

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5c4n47.5235 

Honorable Bob Simpson, Chairman 

House Committee on Insurance 

House of Representatives 

Room 125, Reagan Building 

Austin, Texas 78701 

Opinion No. My-321 

Re: Application of the Bail Bond 

Act to insurance companies 

Dear Representative Simpson: 

You have asked several questions concerning the relationship between 

the Texas Bail Bond Act, article 2372~3, V.T.C.S., and the Texas Insurance 

Code. You first asked: 

1. Is a duly licensed and certified insurance 

company, qualified and licensed to do business in 

Texas under the Texas Board of Insurance rules and 

regulations, etc., subject to the Bail Bond Act 

(Article 2372~3, as amended, Licensing and Regulation of Bail Bondsmen) when they operate strictly as 

co-sureties with licensed bondsmen In the writing of 

court and appearance bonds In Texas, or are they 

exempt as per section 3(d) of said act? 

In general, the Texas Bail Bond Act, article 2372~3, V.T.C.S., does not 

exempt msurance companies engaged In the writing of bail bonds from the 

requirements of the Texas Insurance Code, nor does the Texas Insurance 

Code exempt companies writing such bonds from the requirements of the 

Texas Bail Bond Act. An Insurance company that is duly licensed and 

certifiid to write bail bonds by the State Board of Insurance is not subject to 

the Iicensing provisions of the Texas Bail Bond Act if the company Is a cosurety with a licensed bondsman. Sections 3(a) and 3(d) of the Bail Bond Act 

provide: 

Sec. 3. (a) No person may act as a bondsman 

without the license required under the provisions of 

this Act, except as provided In Subsections (bl, (cl, 

and (d) of this section. 

..,. 

(d) Persons who execute bonds as cosureties with a 

licensed bondsman. 
’ 

Honorable Bob Simpson - Page Two (R’k- 3 2 1) 

Section 2 of the Bail Bond Act 

corporations, and therefore Section 3(d P 

rovides a definition of “person” that includes 

would exempt an insurance company acting as 

a co-surety from the licensing requirement of the Bail Bond Act. We do not address 

whether a person is necessarily entitled to act as a co-surety with an insurance 

company while at the same time acting BS sgent for the insurance company without 

the company’s complying with the licensing requirements of the Bail Bond Act. 

However, if the insurance company is acting in the capacity of a surety, section 3(a) of 

the Bail Bond Act would require an insurance company to comply with the licensing 

requirements of the act. 

You next ask the following questions: 

2. Is a person duly licensed to make bonds under the Bail 

Bond Act required to have a Texas Recording Agent’s License, 

or is he exempt in accordance with section 7(d) of said act, 

stating that a licensed bondsman shall not be required to have a 

Local Recording Agent’s License? 

In a county subjsct to the Bail Bond Act, the person is exempt. However, in a 

county not subject to the Bail Bond Act, the person must have a local recording agent’s 

license issued under article 2L14 of the Texas Insurance Code. 

3. Does an insurance company that is licensed with a local 

Bail Bond Board under article 2372p-3, as amended, have an 

obligation to register in any manner or form with the Texas 

State Board of Insurance to act as co-surety or surety on court 

bonds or surety bonds in the state of Texas? 

In Texas, the only corporation that may act on a regular basis as a corporate 

surety is sn insurance company chartered under chapters 2 and 8 of the Texas 

Insurance Code. See Attorney General Opinion WW-438 (1958). In Freedom, Inc. v. 

m, 569 S.W. 2=8 (Tex. Civ. App. - Austin 1978, no writ), the court held that a 

corporation acting as a professional surety in writing bail bonds was engaged in the 

insurance business and was required to obtain a certificate 6f authority from the State 

Board of Insurance. Further, no provision in the Bail Bond Act relieves an insurance 

company from compliance with the provisions of the Texas Insurance Code regarding 

its ability to act as a surety. When an insurance company engages in the business of a 

surety in a county sub&t to the Texas Bail Bond Act, section 7(b) of the act clearly 

contemplates a dual licensing procedure for the insurance company under both the Bail 

Bond Act and the Texas Insurance Code. 

You nextask: 

4. Is it legal for an individual to use an assumed name if an 

Assumed Name CertifiCate is duly filed and executed with the 

County Clerk of the counties in which the individual is doing 

business, in the writing and posting of bonds in counties not 

subject to bail bond acts, and must the surety company be 

p. 1030 
Honorable Bob Simpaon - PeeThree (NW-321) 

registered with the Texas State Board of Insurance when the 

privately-owned company is the surety on bail bonds? 

An individual may use an assumed name in the writing and posting of bonds, 

provided, however, that the use of such a name does not violate either the statutory or 

common law regarding names. Nothing in article 2372p-3 would prohibit the use of an 

assumed name by an individual properly licensed in a county with a bail bond board, 

and neither this statute nor any other prohibits an individual from using an assumed 

name in counties without bail bond boards. However, the use of an assumed name is 

proper only after a business entity or individual complies with the filing requirements 

of chapter 36 of the Texas Businses and Commerce Cc&. 

If an individual is the surety on bail bonds, then no registration with the State 

Board of Insurance is required. However, if a corporation is the surety, then it must 

comply with the regulations set forth in the Texas Insurance Code. The court in 

Freedom, Inc., supra, held that for a corporation to be empowered to act as a surety it 

must obtain a certificate of authority from the State Board of Insurance. This 

requirement applies to every corporate surety regardless of whether the county in 

which it will operate is subject to the Bail Bond Act. 

SUMMARY 

(U Section 3(d) of article 2372~3 does exempt an insurance 

company acting as a co-surety from the licensing requirements 

of the Bail Bond Act. 

(2) Section 7(d) of article 2372p-3 exempts, M&r certain 

circumstances, a licensee under the act from the requirements 

of holding a recording agent’s license. 

(3) Notwithstanding licensing with a local Bail Bond Board, 

an insurance company is required to comply with the applicable 

provisiors of the Texas Insurance Code in order to act as a 

surety or co-surety onibonds. 

(4) No provisions of article 2372~3 prevent the use of an 

assumed name; of course, all statutory and common law 

requirements must be complied with. Furthermore, the only 

corporation which may act as a surety cn bail bonds is an 

insurance company, and it must comply with the Texas 

Insurance Code and obtain a certificate of authority from the 

State Board of Insurance. 

MARK WHITE 

Attorney General of Texas 
Honorable Bob Simpson - Page Pour (NN- 321) 

JOHN W. FAINTER, JR. 

First Assistant Attorney General 

RICHARD E. GRAY III 

Executive AssIstant Attorney General 

Prepared by Thomas M. Pollan 

Assistant Attorney General 

APPROVE& 

OPINION COMMIl’TEE 

Susan L. Garrison, Chairman 

C. Robert Heath 

Thomas M. PolIan 

Nancy Ridtetts 

p. 1032