Arizona Reclamation and Damage Bond

Arizona Reclamation and Damage Bond

Mining operations in Arizona may be required to purchase a Reclamation and Damage Bond in order to receive a permit to mine. Jet Insurance Company offers this bond as a guarantee to the Arizona State Land Department to assist in payment for damages sustained from unsafe mining operations to humans and livestock, or from failure to reclaim land following the permit period.

APPLY FOR YOUR BOND

Jet is a one-stop shop to get bonded without unnecessary delays. We offer monthly payment options as well to help with what can be an expensive surety bond to purchase.

How Does Jet Determine the Price for the Reclamation and Damage Bond?

By applying online through the link above, you will submit some basic information to Jet to start the application process. One of our underwriters will get back to you shortly after to finalize what further information will be needed to get approval and set the bond rate. We may need to review business and personal financial statements and the permit/reclamation details.

The bond price is always a small percentage of the bond limit that is set by the State Land Department. The bond limit is an amount deemed to be necessary to restore the land and its vegetation in a sufficient manner. The permit agreed upon with the state will determine what needs to be done in order to make Arizona safe and beautiful.

Jet will email you our quote along with a link to securely purchase the bond online once we complete our review of materials. Following purchase, you will receive a copy of the bond along with receipt of the purchase.

How Does Arizona State Land Department Determine the Bond Amount Required?

For starters, a $3,000 Reclamation and Damage Bond amount is required for each permit pulled regarding exploration or mining for mineral resources. A $15,000 blanket bond amount can be purchased in cases where 5 or more permits need to be pulled.

For larger operations, the Arizona State Land Department will require custom bond amounts and requirements within those bonds. Jet will need to do a deep dive into the bonding and permit requirements to determine eligibility and the bond rate.

Why Is the Reclamation and Damage Bond Required by the State of Arizona?

The State of Arizona wants to keep it’s landscape beautiful and in its natural state. Yet, it also wants to profit off the natural resources that exist within its crust. The bond provides the glue to bind these two concepts together by having a third party, like Jet, guarantee that if the mining operation damages Arizona and cannot or will not correct their actions, then the surety company will pay for such things to happen (up to the bond limit). The bond is Jet’s written guarantee.

Any easy way to think of it is like this: you want to put a hole in the earth and get some goodies. The state doesn’t trust you to fill the hole back up or protect the surrounding area. Jet steps in and tells Arizona you are trustworthy and will get it done while flashing a stack of dollar bills in the background the whole time.

Can Jet File the Reclamation and Damage Bond For Me?

Is there another way? Of course! Jet will file the bond for you unless you would rather send it in with the permit yourself. So, I guess there is another way. Either way, the bond is going to the following location and you decide how you want to get it there.

Arizona State Land Department
1616 W. Adams St
Phoenix, AZ 85007

What Happens If I Need to Cancel My Reclamation and Damage Bond?

This is not an easy proposition as liability for the mining operation lasts long after the equipment goes silent. Jet will need to either get a release of liability from the Arizona State Land Department, because you have been cleared for an excellent job on the reclamation, or you will be required to have another surety bond in place to take on future liability.

Good news is, once we get a release, Jet will return any unearned premium on the bond to you. For those that pay monthly, we will just stop your payments.

Do I Need to Renew My Bond with Jet?

If you make monthly payments, the answer is no! So long as the payment comes out of the card you provide, the bond stays active. The bond is continuous until cancelled by the surety company (Jet) so there need not be any exchange of paperwork.

If you pay on an annual basis, Jet will send notice prior to the bond term expiration. You need only to make payment to keep the bond active.

How Does a Permit Holder (Mining Operation) Avoid Reclamation and Damage Bond Claims?

Everything starts with the permit contract entered into. If you uphold the terms of the mining operation and reclamation, you will most likely avoid any disciplinary action from the Arizona State Land Department. To complete the protective shielding from trouble, follow the rules in the Arizona Administrative Code regarding natural resources and the Arizona State Statutes regarding minerals, oils and gas. We are sure you are up to date on all the stipulations contained within these resources.

The State of Arizona will bring an investigation against you should they “smell smoke”, and will take mitigation action, if possible, should there be damages. It is in the best interest of the mining operation to abide by the action plan set forth by the state. Failure to do so may result in civil actions, revocation of permit, and a claim on the surety bond.

What Happens If I Get a Reclamation and Damage Bond Claim?

If you are reading this because you have received a claim of a bond with Jet, then you are already moving in the right direction to continue as a mining operation in the future. Jet will need any details you have regarding the case, as we will mount a case in your defense as much as is reasonable. If the state brought trumped-up charges against you, then we will take it to them.

However, if the claims are valid, Jet will make payment to the state for the damaged amount up to the limit of the bond. With the State of Arizona being made whole, Jet is now at a deficit and unlike insurance, this is not the end of the process. Jet and other surety carriers charge a small percentage of premium for a reason (we most often charge less than others though), and that is due to the fact that the principal (mining operation) remains responsible for their actions and is required to pay the surety company back. If a mining operation creates damages and never makes restitution for them, especially through a bond payout process, there is little to no chance they will be able to operate again in Arizona, let alone elsewhere.

Arizona Reclamation and Damage Bond Form

Notary Bond Application:

X

Business Information:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Employee Dishonesty Bond Application:

Business Information:

Business Description:

Coverage Requirements:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Contract Bond Application:

X

Business Information:

Owner Information:

Job Details:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Worker's Compensation Application:

X

Business Information:

Business Description:

Coverage Requirements

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information: