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Arizona Utility Deposit Bonds
Utility companies in Arizona, such as the Arizona Public Service Company, City of Stafford, Southwest Gas Corporation, and Tucson Electric Power Company, use Utility Deposit Bonds to guarantee payment of their services. Customers who have a history of payment issues may be required to put up a security deposit in an amount that would cover the monthly payment for utility services provided. Utility companies will accept the Utility Deposit Bond instead of the full deposit required.
Purchasing your Utility Deposit Bond allows you to pay a small percentage of the amount of financial assurance required and still have the full amount of coverage needed.
What Is the Lowest Price for the Utility Deposit Bond?
The cost for a Utility Deposit Bond starts at $100 but varies based on the required bond limit. Another factor of the cost is your personal credit score, which is evaluated in moments during the application. The chart below shows the quote for an applicant with good credit at different bond limits.
| Bond Limit | Cost |
|---|---|
| $10,000 | $100 |
| $25,000 | $250 |
| $50,000 | $500 |
You can expect to get your bond quicker for less money with Jet. We have eliminated middlemen, brokers, and agents so you can get bonded directly from the company that will represent you.
How Is the Utility Deposit Bond Limit Calculated?
The bond limit is based on the amount that each utility company needs as a deposit. The utility company will indicate what the bond limit needs to be, but in general, it can range from one month’s utility payment to 2.5 times a monthly payment.
Why Is the Utility Deposit Bond Required?
The Utility Deposit Bond is usually enforced as a disciplinary action, when you, as the customer, have habitually late payments or missing payments. Basically, utility companies will invoke a deposit bond as a way to protect themselves against being gypped.
How Does the Application Process Work With Jet?
Jet’s application only takes a few minutes to fill out because we don’t ask unnecessary questions. You only have to provide basic business information, the required bond limit, and a social security number in order to receive a quote.
Once your application is complete, you will receive a quote that is available for purchase right away. After purchase, a receipt and a copy of your bond will be emailed to you.
Can Jet File the Utility Deposit Bond for Me?
Yes! When you purchase your Utility Deposit Bond with Jet, our team will prepare the bond form with the required information, signatures, and a surety seal before sending it off to the utility company you are working with. If you need the original bond mailed directly to you, you can indicate where to mail the bond during purchase.
The original bond must be mailed to the corresponding address listed below:
Arizona Public Service Company
APS
Commercial Credit Department
PO Box 53933, M.S. 3209
Phoenix, AZ 85072-3933
City of Safford
City of Safford
405 W. Discovery Park Blvd
Safford, AZ 85546
Southwest Gas Corporation
Southwest Gas Corporation
P.O. Box 1498
Victorville, CA 92393
Tucson Electric Power Company
Tucson Electric Power Company
3950 East Irvington Road
Tucson, AZ 85714
Can I Cancel My Utility Deposit Bond and Get a Refund?
With Jet, a cancellation of a Utility Deposit Bond will result in a prorated refund if there is time left on the bond. What that means is, if you paid for one year of bond coverage but cancel the bond early, you will be refunded for the time that your bond was not active.
To cancel your bond, send a written request to Jet and we will let the utility company know to start processing the cancellation. They will keep the bond in effect for another 60 days (30 days for Safford) before cancellation is final. This added time of liability will be deducted from your refund. However, keep in mind that cancelling your bond with Jet will not release you from needing coverage; a replacement bond or deposit needs to be filed to the utility company.
Can I Renew the Utility Deposit Bond?
The Utility Deposit Bond can be renewed annually as long as the bond is required by the utility company. The utility company usually requires the bond as a disciplinary measure and, in some cases, once you prove that you will complete payments as scheduled, the bond is no longer needed. An example of this is the Arizona Public Service Company which, after 24 months, reviews the deposit bond requirement and may release the customer if there have been no issues with payment.
Jet will send you notice through mail and email ahead of the renewal date. You just need to fill out the renewal notice and submit it back to us, whether online or through mail. Jet will renew your bond as soon as we receive the notice and renewal premium. Be sure to confirm with the utility company whether or not the bond is still required. If your bond is no longer required, you don’t need to do anything — Jet will cancel your bond once your term is up.
How Does I Avoid Utility Deposit Bond Claims?
In order to avoid bond claims on a Utility Deposit Bond, it is important to understand why the bond was put in place. A Utility Deposit Bond is used to guarantee payment to the utility company, usually because there has been a history of not paying on time or missing payments entirely. The bond requirement comes into play when you have done one of the following:
- Arizona Public Service Company
- Missed two or more payments in a 12-month period
- Southwest Gas Corporation
- Been late on three or more payments in a 12-month period
- Been disconnected from service within 12-month period
- Tucson Electric Power Company
- Been late on three or more payments within a 12-month period
- Been disconnected from service within a 12-month period
- Have a credit score that does not meet minimum requirements
- The City of Safford requires all of their customers to have this bond as a final payment advance should the customer go bankrupt or go out of business without paying their final bills.
The best way to avoid claims on the bond is to make payments every month and make sure they are on time (even the last payment before your service ends or if you become insolvent). This will prevent not only claims, but the need for the bond in the first place. If you become insolvent, bankrupt, or simply choose to not pay, the utility company will go after the bond for reimbursement. You are obligated to pay what was due, as well as any legal fees during the bond claim process. It’s best to make payment for service you have received before it escalates into a bond claim.
What Happens if I Get a Utility Deposit Bond Claim?
If you receive a claim on your Utility Deposit Bond, it’s usually because you haven’t made payment and the utility company can back up their claim. If a demand for payment is sent to Jet, Jet is obligated to pay the claim within 30 days of receiving the demand to the Arizona Public Service Company, and within 60 days to the Southwest Gas Corporation and the Tucson Electric Power Company.
Once the utility company has received payment from Jet, you are not off the hook. The bond acts as an extension of your credit and since you are ultimately responsible for your actions, you must pay Jet back in the amount that was paid out.
Is There an Alternative to the Utility Deposit Bond?
Yes, when there has been an issue of receiving payment, the utility company will need a method of assurance for monthly payment or final payment for utility service, such as a deposit.
In lieu of this deposit, the utility company will accept a Utility Deposit Bond. Through the bond, you only have to pay a small portion of the required deposit amount to receive coverage. However, the bond does not work like insurance, and you will be required to pay Jet back if the bond pays out to the utility company, but it is a favorable alternative to the deposit. When you file a deposit, you must submit the full amount that the utility company asks for, and the deposit will only be released when the utility company no longer requires it and releases it back to you.
