Many people love to travel. If you are planning to turn your affinity for travel into a money-making career as a travel agent, then you will need to understand the ins and outs of an ARC bond.
The Airlines Reporting Corporation (ARC) requires any party selling airline tickets to customers obtain a specialized surety bond known as an ARC bond. Learn more about these bonds so that you can ensure your travel agency is in compliance with ARC regulations.
What Is an ARC Bond?
An ARC bond is a special type of surety bond. These bonds fall under the financial guarantee category of bonds, and they are designed to protect the interests of the airline carriers you work with to help your clients book their travel.
In the event that an airline doesn't receive payment for tickets you have sold, they will file a claim against your ARC bond. The bond issuer will investigate the claim and, if the claim proves to be valid, pay the airline. You will then be responsible for paying the bond issuer.
Is an ARC Bond the Same as a Seller of Travel Bond?
Many states require that travel agents maintain a seller of travel bond. You may be wondering if this bond serves the same function as an ARC bond, and the answer is no. The primary difference between the two types of surety bonds lies in the obligee.
An ARC bond is designed specifically to protect the financial interest of major airlines while a seller of travel bond offers protection for the state and all of your customers in the event you engage in unethical business practices.
How Can One Obtain an ARC Bond?
Once you have determined that you need an ARC bond, you will need to locate a reputable surety bond company to help you obtain the right bond. You will be required to submit paperwork referencing your personal credit and finances as well as documentation proving the validity of your business.
Based on this information, the bond issuer will identify the percentage of the bond that must be paid up front to ensure coverage. Pay the fee and complete all paperwork accurately, and you should be issued an ARC bond within a matter of days.
Don't let the administrative requirements associated with selling airline tickets deter you from pursuing a career as a travel agent. Work with an experienced professional from a company like NFP, P & C, Inc. to obtain your ARC bond today.
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