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Effort to Repeal No-Credit Fails

Indianapolis, IN – An effort to repeal Indiana’s no-credit law on bail premiums failed yesterday.  Amendment HB1006 #30 was offered by Senator Steele during the Senate Judiciary Committee.  Senator Steele is a longtime supporter of commercial bail and public safety issues.  The president of the Indiana Surety Agents Association testified in opposition to the amendment, specifically that portion dealing with the repeal of no-credit on bond premium.  As a result, the amendment failed to pass.

The proposed amendment did two things. Number one, it repealed the no-credit law allowing bail agents to accept payment terms on the premium.  Current Indiana law requires bail agents to collect the entire premium prior to posting a bond.  Number two; it is the defendant’s choice to post a full cash bond or a bail bond.  Current law could be interpreted to say a judge can set a ten percent cash deposit bond to the exclusion of all other options.

This legislative effort was initiated by American Surety Company and we are very proud of this fact.  American Surety Company is the only bail surety company domiciled in Indiana regulated by the Indiana Department of Insurance.  Indiana is our home court.  We feel obliged to act in the best interest of all bail agents in this state.  After years of watching other initiatives fail, we believed it was time to slaughter the sacred cow, that being no-credit.

We sought support from other surety companies doing business in Indiana.  The majority supported.  We invited our agents to our office to discuss our proposals.  The majority supported.  We believe the American Surety agents we spoke with were a fair sampling of all Indiana agents.  We calculated most bail agents in this state would recognize the need for repealing this antiquated law and the value of a law that would allow a defendant to opt for the type of bond they wish to post.

Indiana is the last remaining state to not allow payment terms.  Some Indiana bail agents wear no-credit as a badge of honor.  In actuality, no-credit is more like a pair of handcuffs that prevent bail agents from competing against deposit bail.

Of the 92 counties in Indiana, at least 37 have rooted out bail agents with deposit bail.  The rest of the counties in the state offer a deposit bond option and some percentage of surety bail.  Bail agents are at a major disadvantage because they cannot compete with the ten percent cash option, not if they must collect the full bond premium prior to posting a bond.

Criminal defendants seeking release from jail will continue to select the path of least resistance, deposit bail.  Why would a defendant pay a bond premium and put himself at the mercy of a bail agent and release conditions when they could simply deposit the same ten percent to the court with no conditions?

If a bail agent was able to provide a defendant with payment terms, a number of defendants would start opting for a bail bond.  Why, because it would be the easier path.  Defendants and their family do not always have the money to cover the full ten percent without options they sit in jail.  A lot of people need payment terms, a simple fact.

We firmly believe a bail agent having the legal authority to offer payment terms to their clients and the defendant having the option to post a bail bond is the only way to compete with the ten percent option and reclaim market share in those counties where ten percent is an option and those counties where it’s the only option.

The inability to pass Amendment # 30 was a critical opportunity lost.  Bail agents would finally have something to look forward to rather than count down the days to their industry’s demise.  American Surety Company will continue to use knowledge and common sense in our fight on behalf of bail agents and the preservation of the bail industry.  If you are a member of the ISBAA I urge you to make your position known to them on the concept of repealing the no-credit law.