Purpose of Associations in NMLS Electronic Surety Bonds

Associations in NMLS establish the formal relationship between a surety company and a surety bond producer, authorizing the producer to create and execute Electronic Surety Bonds (ESBs) on behalf of the surety company.

Before an Electronic Surety Bond (ESB) can be created in NMLS, a surety company and a surety bond producer must be connected through an association. The association defines the business relationship that authorizes the producer to execute bonds on behalf of the company and determines the scope of that authorization by state, bond limit, and representative.

Relationship between surety companies and bond producers

An association represents a formal, regulator-recognized link between two NMLS entities:

  • Surety Company: Initiates the association request, defines execution authority, and identifies the states and representatives included in the relationship.
  • Surety Bond Producer: Reviews and accepts, rejects, or requests correction of the association request initiated by the surety company.

Once accepted, the association enables both entities to collaborate on the creation and execution of ESBs for licensees authorized in common states.

Execution authority

Execution authority determines whether a surety bond producer may legally execute and deliver bonds on behalf of the surety company or its underwriting companies. This authority is set when the surety company initiates the association request and is confirmed by the surety bond producer during acceptance.

Each association includes:

  • The surety company or its underwriting company identified by NAIC ID.
  • The surety bond producer identified by NPN.
  • One or more states with authorized bond limits.

Execution authority must exist for each state where both entities are authorized to issue bonds.

Representatives and bond execution

Within an association, representatives (sometimes referred to as Attorneys-in-Fact) are users of the surety bond producer who have signing authority for bonds or bond riders. The surety company identifies these representatives as part of the association request, and their authority is confirmed upon association acceptance.

Representative assignments can include individual bond limits and are managed in the association record. A representative must be both:

  • Active in the surety bond producer’s organization, and
  • Listed in the Representative List of the association to execute ESBs for that company.

Shared responsibilities in the association process

The association process involves coordinated actions by both surety entities:

  1. The surety company initiates an association request specifying execution authority, states, bond limits, and representatives.
  2. The surety bond producer receives the request, reviews details, and either accepts, requests correction, or rejects it.
  3. Once accepted, both entities receive confirmation notifications in NMLS and can begin managing ESBs together.

If changes are required later, either party can request corrections or initiate removal of the association. NMLS tracks each association’s current status and history for regulatory review.

Batch upload capability for surety companies

Surety companies may create associations individually within NMLS or in bulk by uploading an XML file that conforms to the Surety Company Association Upload Specification. The batch upload method enables companies to generate multiple associations simultaneously using data from internal systems.
Note: Surety bond producers cannot initiate associations or perform batch uploads; they respond to requests initiated by surety companies.
Tip: For both surety companies and bond producers, maintaining accurate association data ensures that ESB execution authority aligns with regulator-approved authorizations and that representatives’ signing authority remains current.