10.1 Premiums, Filed Rates, and CCR 2081

Premiums, Filed Rates, and CCR 2081

Quick Answer: Charge only the premium at the rates established by the insurer and set forth on the undertaking of bail, or the bail-bond charges filed under 10 CCR 2094. CDI's consumer page adds that each surety must file rates and that agents representing a surety must charge those same filed rates. Ten percent is a common industry description, not a California statute. 10 CCR 2081 is then a closed list of the only money you may collect in the transaction.

A California bail premium is the price of the surety's promise. The court has set a penal amount. The family cannot or will not deposit that full amount in cash with the clerk. The surety issues an undertaking of bail and, in exchange, collects a premium. That premium is consideration for insurance risk — the risk that the defendant will fail to appear and the surety will owe the court the penal sum. It is not a refundable deposit, not a court cost, not a 'holding fee,' and not the agent's personal wage that can be marked up because the jail window is open at 2 a.m.

Why is it charged at all? Because a compensated surety is in the business of guaranteeing appearance. The premium is how that business is paid. Collateral, taught in Chapter 11, is security for the same risk; it is a different pile of value and is not a substitute for premium. Expenses under 10 CCR 2081(c) and (d) reimburse out-of-pocket costs of that individual transaction or of the arrestee's breach. They are not a second premium.

The filed-rate rule, not a statutory ten percent

10 CCR 2081(a) is the charging sentence. No bail licensee shall, in any bail transaction or in connection therewith, directly or indirectly charge or collect money or other valuable consideration except for listed purposes, and the first listed purpose is:

To pay the premium at the rates established by the insurer and set forth on the undertaking of bail, or to pay the charges for the bail bond filed in connection with such transaction at the rates filed in accordance with Section 2094.

Two tracks sit in that sentence.

CDI's consumer bail page restates the surety track in plain language. CDI's Rate Regulation Branch determines whether bail premium rates charged to consumers in California are fair. Each surety company must file rates with CDI, and bail agents representing a surety must charge the same filed rates. The court determines the amount of the bond. The cost to the consumer is most commonly ten percent of the total amount of the bond, plus actual, necessary, and reasonable expenses incurred in connection with the transaction.

Read that last sentence the way the exam will twist it. 'Most commonly ten percent' is CDI describing the industry. It is not a Penal Code rate, not an Insurance Code rate, and not a Title 10 default. If the undertaking in your hand shows a different filed figure, 2081(a) tells you to charge that figure. If two sureties you represent have two different filings, you charge each surety's own filed rate on that surety's paper. You do not pick a house rate of 'we always do eight' or 'we always do twelve' and apply it to every company.

10 CCR 2094 is narrower than candidates expect. Every bail permittee shall file with the commissioner a schedule of charges to be made for bail, and shall file any change at least five days prior to the effective date. Those filings are public records. An ordinary appointed bail agent lives on the insurer's filed rate set forth on the undertaking, not on a personal 2094 schedule. Do not treat 2094 as a license to invent a side menu of 'agent fees' on surety paper.

10 CCR 2081 is a closed collection list

After premium, 2081 still controls the rest of the money that may change hands.

(b) Collateral. You may collect collateral. Holding it is a fiduciary job under 10 CCR 2088, taught with Chapter 11. Collecting it does not change the premium.

(c) Actual, necessary, and reasonable expenses incurred in connection with the individual bail transaction, including but not limited to:

1. Guard fees after the first 12 hours following release of an arrestee on bail. The first 12 hours are not a billable guard period.
2. Notary fees, recording fees, necessary long-distance telephone (calls the telephone company bills as long distance, not message-unit local calls), telegram charges, travel expenses and verification of collateral outside of the county where the bail was arranged, and a reasonable posting fee charged by a licensee operating in a county other than that where the bail was arranged. No charge shall be made for travel from the licensee's office to post bail in an area where the licensee advertises in the yellow pages of the telephone directory unless the advertisement specifically so states. When travel charges are permitted, they shall not exceed the amount allowed as a travel expense for income tax purposes under the federal Internal Revenue Code and regulations, or the amount the State of California allows its employees to claim for mileage, whichever the licensee chooses. Do not freeze a dollar-per-mile figure the regulation does not publish.

(d) Breach expenses. Actual reasonable and necessary expenses incurred and caused by a breach by the arrestee of any of the terms of the written agreement under which the undertaking or bond was written. Reimbursement may not exceed the penal amount of the undertaking or bond and may include a reasonable charge for the services of the licensee, the licensee's employees, partners, or other persons associated with the licensee in that particular transaction of bail.

(e) Forfeiture add-on. If a forfeiture of bail occurs and is not set aside, the expenses under (c) and (d) incurred within 180 days of such forfeiture may be charged in addition to the amount of such forfeiture.

10 CCR 2082 then nails the back door shut. Except to the extent 2081(c), (d), and (e) permit, no bail licensee shall make any charge for the bail licensee's services in a bail transaction in addition to the premium on an undertaking, or the 2094 charge for a bail bond. A 'document fee,' 'after-hours fee,' 'jail-run fee,' or 'risk surcharge' that is not an actual 2081(c) expense of that transaction is a 2082 violation even if the family agrees to pay it.

Charging the proper amount therefore has three moving parts: (1) bill the filed premium or 2094 charge, not a homemade percentage; (2) itemize only 2081(c)/(d)/(e) expenses that actually happened; (3) do not tack on a service charge 2082 forbids. Chapter 4 introduced this list as the transaction money rule. This section is why the premium line on that list is a filed-rate problem, not a sales problem.

California scenarios

San Jose filing mismatch. A Santa Clara agent represents Surety A, whose undertaking prints a filed premium of eight percent of the penal amount, and Surety B, whose undertaking prints ten percent. The family asks for 'the usual ten.' 2081(a) and CDI's consumer page both say the agent charges the rate established by that insurer and set forth on that undertaking. Inventing a house ten percent on Surety A's paper is an overcharge.

Bakersfield yellow-pages run. An agent advertises in the local directory and drives from the office to the jail three miles away, then adds a 'trip charge.' 2081(c)(2) forbids travel from the office to post in an advertised yellow-pages area unless the advertisement specifically says travel will be charged. A silent ad means the trip is on the licensee.

Ventura posting. A Long Beach agent arranges the bond. A Ventura licensee posts it and invoices a reasonable posting fee plus local cell-phone minutes. 2081(c)(2) allows the out-of-county posting fee. It does not allow message-unit local calls.

First-night guard in Stockton. The family wants a guard 'until morning' and will pay cash. 2081(c)(1) allows guard fees only after the first 12 hours following release. Billing hour one is an illegal collection, not a negotiated extra.

Forfeiture add-on in Riverside. The bond forfeits and is not set aside. Recovery and recording costs land on day 90. 2081(e) allows those (c) and (d) expenses incurred within 180 days of forfeiture to be charged in addition to the forfeiture itself. Day-200 expenses do not get that add-on.

Traps

• Ten percent is a CDI industry description, not a California statutory premium. The legal number is the filed rate on the paper in your hand.
• Agents representing a surety must charge that surety's filed rates. A personal 'agency rate card' is not 2081(a).
• 2094 is a permittee schedule with a five-day change filing. It is not a hunting license for side fees on surety undertakings.
• 2081 is closed. If the charge is not (a) through (e), 2082 forbids it.
• Guard fees start after 12 hours, not at release.
• Long-distance is chargeable; message-unit local calls are not.
• Travel into a yellow-pages advertising area is not chargeable unless the ad specifically says so.
• Mileage, when permitted, is the IRS travel-expense amount or the state employee mileage amount, whichever the licensee chooses — not a number you memorize from a study-guide rumor.
• Breach expenses cannot exceed the penal amount.
• 2081(e) expenses are in addition to forfeiture only if the forfeiture is not set aside and only if incurred within 180 days of that forfeiture.