How to Get a Lottery Agent License in New York

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How to Get a Lottery Agent License in New York

Surety Bond Professionals is a family owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all of your New York lottery license retailer application and bond needs.

How Do I Get a Lottery Agent License?

New York lottery retail agents are licensed by the New York Gaming Authority, Division of the Lottery. If you met the eligibility requirements and already have an established business, the licensing process begins with your submission of a completed application.

What Does the Licensing Process Involve?

Submitting a completed application authorizes the New York Lottery Commission (NYLC) to investigate your financial status and credit history, tax liabilities, and any criminal background. Once these have been evaluated and your application has been approved, a Lottery representative will work with you to schedule your orientation and training and installation of lottery equipment.

Not every application is approved. Some will be denied, and some will be granted conditionally, predicated on the applicant providing NYLC with a surety bond.

Why Is a Lottery Bond Required?

When NYLC’s investigation of a prospective lottery agent raises concern about the applicant’s ability to meet the Lottery’s financial responsibility standards, the applicant may be required to purchase a surety bond to protect the State against monetary loss, for example from the agent’s failure to remit lottery sales proceeds. The surety bond not only requires the lottery agent to comply with all NYLC rules and regulations, but also to pay valid claims for damages incurred by the State or the public as a result of the agent’s unlawful or unethical actions. 

When a surety bond is required, NYLC will establish the required bond amount based on lottery sales projections for the business.

How Does a Lottery Bond Work?

There are three parties to a New York lottery bond: NYLC is the “obligee” requiring the bond, the lottery retailer is the “principal,” and the bond’s guarantor is the “surety.” Upon submission of a claim, the surety will investigate it to determine whether it is valid.

The principal is legally obligated to pay all valid claims. But, having guaranteed the payment of claims, the surety will pay a valid claim initially and be reimbursed later by the principal. There is, of course, the risk that the principal won’t repay that debt readily, which could result in a lawsuit by the surety to recover the claim amount.

What Does a Lottery Bond Cost? 

The premium rate for a New York lottery bond is set by the surety for each bond sold. The premium rate is the result of an underwriting assessment of the risk of the surety not being reimbursed for claims paid on the principal’s behalf. That assessment is based largely on the principal’s personal credit score. 

Someone with a high credit score can be assumed to be a low risk and is assigned a credit score that is in the range of one to two percent. A bond applicant with a low credit score will pay a higher premium rate.

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Our surety bond professionals will get you the New York lottery bond you need at a competitive rate.