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Alabama Health Studio Bond
The $50,000 Health Studio Bond in Alabama is required by the Attorney General for the registration of all gyms, health clubs, weight rooms, massage parlors, steam rooms and whirlpool baths. Jet Insurance Company provides this bond as a guarantee to the Attorney General should the health studio fail to contractually refund its customers, then Jet will.
Jet offers an affordable monthly payment option that is perfect for this relatively high bond limit requirement!
What Is the Lowest Price for the Alabama Health Studio Bond?
With Jet, the bond cost starts at $50 monthly or $500 annually. Eligibility and rates are based on the financial strength of the health studio. The price chart below is for our preferred tier.
| Bond Term | Cost |
|---|---|
| Monthly | $50 |
| 1 Year | $500 |
| 2 Years | $875 |
Jet’s payment options are second to none and done online without lengthy contracts or fees.
What Is the Purpose of the Health Studio Bond in Alabama?
The State of Alabama Legislature recognizes the significant impact and gains made by the health industry to Alabama’s population. However, there can be undue financial hardship placed upon Alabama’s citizens when the health studios collect prepaid memberships and do not return money to those appropriately requesting a refund, or to the whole membership group if the club goes out of business.
The Health Studio Bond brings in a third party financial institution, basically a spotter, to make sure if the health studio fails to provide a refund, then the surety company (Jet) provides the necessary funds and distributes payments.
The Alabama Attorney General’s Office got tagged with the responsibility to manage the registration and enforcement of Alabama’s health studios. Part of Attorney General’s duty is to make sure the bond is in place and that the surety company has the financial muscle to guarantee payment. Don’t worry about Jet, ‘we swole’.
How Does the Application Process Work With Jet for the Health Studio Bond? How Do I Get a Lower Rate?
By clicking the button above or calling 855-296-2663, you can get the ball rolling. Online, we will only ask some basic questions about your business. You will then get a call back from one of Jet’s underwriters, unless of course you just call in first, to finalize the details of what is needed for the application. There are no middleman agents or brokers in the way who don’t know squat and cause delays.
We may need to review your personal and business financials, along with a copy of the customer contract, to determine eligibility and rate options. The more information you can provide, the better rate we can secure.
When the quote is ready, we will email you the rate and a link to purchase the bond online. A copy of the bond and receipt will be available right after purchase.
How Is the Health Studio Bond Filed With the Alabama Attorney General?
Jet will send the bond directly to the Attorney General for filing following your purchase of the bond. We do have the ability to back date the bond should you require that to avoid any legal ramifications from the State, but only up to 30 days max.
Should you want to file the bond yourself, perhaps with the initial registration application, then just let us know at checkout and we will get the bond to you.
All paperwork would need to be sent to the following address:
Alabama Attorney General
Consumer Protection
PO Box 300152
Montgomery, AL 36130-0152
Can I Cancel My Health Studio Bond and Get a Refund?
Oh yeah! Jet will refund any unearned premium (time left on the bond) to you following cancellation. We do have to confirm release of liability from the Attorney General first, but that should not take too long. If you are on monthly payments, we will have to charge you until release is given by the Attorney General should they not be moving too quickly.
To request cancellation of the bond, just email us at [email protected].
How Do I Renew My Bond With Jet?
If you are on the monthly payment plan then you do not need to worry about a thing.
However, if you purchase on annual terms, whether 1, 2 or 3-years, then there is an expiration date on that bond and you will need to provide Jet payment before that date. The Attorney General will place the registration on suspension without an active bond file.
Jet will send you a renewal notice with plenty of time to make payment before that expiration date, and renewal is as easy as making payment over the phone, online or via check in the mail.
How Does a Health Studio Avoid Bond Claims?
Let’s start with your customer contract. You will need to include the mandatory provisions per Title 8 Chapter 23 of the Alabama Code:
- Penalty free cancellation within 3 days of contract signing
- Make prorated refund should health studio go out of business
- Make prorated refund should health studio move 5 miles away
- Make prorated refund should member die or become disabled
- Make prorated refund should member moves 15 miles away and no affiliate exists there
- No financed membership fees over 24 months
- Member has right to cancel and get refund if health studio misrepresented offering
The Alabama Code is dictating how consumers need to be protected financially by demanding what language must be in the contract. Health studios must then abide by the contract and refund policies or face complaints from their members (more like former members).
The Attorney General will investigate claims and should the health studio be at fault, the Attorney General will make an attempt to mitigate a plan for the studio to rectify damages to the members. Health studios should abide by these demands if they plan to stay in business. Ultimately, the Attorney General will go to the surety bond for any damages to the public that go unsettled by the health studio.
With all that said, if the health studio went bankrupt or just bails on the business, there will be no funds to refund customers prepaid membership fees. A claim on the surety bond is the only recourse.
What Happens if I Get a Health Studio Bond Claim?
If you are still around, Jet will put together a defense against any fraudulent member claims or cases of government malfeasance with the evidence you provide. So be sure to open a line of communication with us the second you catch wind of complaints concerning your refund policy.
A valid bond claim will result in a payout from Jet in the amount of the claim, but not to exceed the $50,000 bond limit. Jet will pay all claimants a prorated amount if the damages exceed that amount, as we are not responsible for anything above the bond limit.
The story doesn’t end there. The surety bond is a fiscal guarantee and not a transfer of guilt. Jet is a third party promising payment, but the guilty health studio is still liable. Jet is indemnified to receive payment back from the health studio.
