What is a Bail Bondsman and what does he do?
A Bail Bondsman is a person that acts as a surety and pledges money as bail for someone who has been accused of a crime and is incarcerated at any jail, like the Los Angeles Jail for example. Every bail bondsman has an insurance company (surety) that backs them for the bail bonds they write. You’ll mostly find bail bondsman in the United States.
A Bail Bondsman has to have a license to do business write bail. This requires a class that takes up to 24 hours and finishes with a test that must be passed with a grade of 75% or better. The class has to be approved by the California Department of Insurance (CDOI). Once the class is finished, they receive a certificate of completion. This certificate and various other paperwork must be filed with the CDOI. They will perform a thorough background check. All felonies and misdemeanors must be stated clearly in the bail bonds application and all crimes must have explanations and what the results were from the case. They also have to be backed by a Surety, an insurance company that backs bail bonds companies.
In most cases the bail bondsman can’t get backed by a surety if they are new to the business. New agents are too high of a risk for the sureties. The normal path is to write bail under a current bail bondsman, they will be considered the general manager of the new bail agent. If the goal of the bail bondsman is to own their own business, they need to write bail under someone for a while to prove they can underwrite bail correctly and then a surety might take them in on their own.
Most bail bondsman will work under someone for a year to two years. This is usually enough time for a surety to understand their abilities and provide them backing. A bail bondsman who works hard and writes a lot of bonds can create a lot of liability and it is important for the surety to know if they are qualified to underwrite the risk involved in bonds, because over the years, they could have millions of dollars in liability.
Say the bondsman writes two bonds a week, each bond is $20,000. So for 50 weeks, take out a week for vacation or something, one year nets them $1 million in liability. Since they are liable for the bonds they right, each bond written adds to their liability. If the business keeps up, that’s $4million in four years. Some of the bonds will get exonerated and that liability will disappear, but the example shows why a surety is very interested in the qualifications of the bail bondsman they will be backing. Some of the bonds written won’t be $20K, half the time the bonds will be $50K, $100K and even more.
On a Daily and weekly basis, bail bondsman are fielding calls either from newly arrested persons or persons calling on their behalf. So, their day is usually spent on the phone working on bonds or working on getting their liability lower. Once the bond is written and the defendant is out of jail, the bondsman’s next step is to work to exonerate the bond and rid themselves of that liability. They go about this by following the court dates for the defendant, making sure they attend, getting court updates, and finally, getting the final results of the case and exonerate the bond. The sooner they can get the bond off their liability the better it is for them, and of course for the defendant.
The Bail Bondsman’s Salary
The bondsman’s salary is derived by the fee or premium they charge for writing the bond. This is 10% of the total bail amount and it is regulated by the CDOI. For a $20,000 bail amount, the bondsman will be compensated $2000. This does not all go to them. The surety that backs them gets a cut and they also have all the other costs associated with running a business. Also, part of the premium goes in to what is called a buff fund. This is a fund that all agents are required to have. Its considered a “back up” fund.
Buff funds are basically savings accounts required by the surety to have in case costs arise from defendants fleeing or skipping bail. The surety requires the agent to pay in to the fund so that the agent can cover themselves in case large costs arise. If the defendant flees and the result is a forfeiture of the bail bond and the agent can not find the indemnitor, the agent has to pay the total amount of the bail. On a $20K bail, if the defendant flees, the agent must pay the court the $20K in full.