How to Get a Lottery Agent License in Texas

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How to Get a Lottery Retailer License in Texas

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 Texas Lottery Retailer Bond needs.

How Do I Get a Lottery Retailer Agents License?

You will need to obtain a Texas ticket sales license before you can operate as a lottery retailer anywhere in the state of Texas. Your options are to:

What Does the Licensing Process Involve?

Whether you apply online or by mail in a completed application, you are authorizing the Texas Lottery to do a check of your credit history and any criminal history through the Texas Department of Public Safety, which requires electronic fingerprinting. After your application is reviewed, you’ll be contacted to schedule a fingerprinting appointment. At that point, you’ll find out whether you need to furnish a surety bond as a condition of licensure.

Why Is a Lottery Bond Required?

If the Lottery Director thinks there is any reason to be concerned that your actions as a retail agent could result in a monetary loss to the state, you may be required to provide a surety bond naming the Texas Comptroller of Public Accounts as the bond’s “obligee.” The required bond amount is established by the obligee on a case by case basis. The bond provides a way to compensate the state or member of the public for damages resulting from your noncompliance with state laws Texas lottery regulations.

How Does a Lottery Bond Work?

The obligee requiring a Texas lottery bond is only one of the three parties to the legally binding lottery bond agreement. The other two are the lottery retail agent (the bond’s “principal”) and the party guaranteeing the payment of claims (the “surety”). Although the surety is the guarantor, the legal obligation to compensate legitimate claimants belongs entirely to the principal. The terms of the surety bond agreement indemnify the surety against any legal liability for claims.

When a claim is filed, the surety will determine whether it is valid and, if it is, will pay it on behalf of the principal. The principal then must reimburse the surety. Failing to repay the claim amount can result in the surety suing the principal to recover the funds.

What Does a Lottery Bond Cost? 

The annual cost of a Texas lottery bond is the product of multiplying the bond amount set by the obligee and the premium rate assigned by the surety through underwriting. The underwriters use a bond applicant’s personal credit score to assess the risk of the surety not being reimbursed for claims paid on the principal’s behalf. A high credit score suggests a low-risk level and vice versa. The greater the risk to the surety, the higher the premium rate. 

Lottery bonds typically cost in the 1-2% range for applicants with high credit scores. Applicants with lower credit scores may pay a higher premium rate.

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Our surety bond professionals will get you the lottery retailer bond in Texas you need at a competitive rate.