To avoid suspension due to bond expiration, the new bond’s effective date must match which date?

To avoid suspension due to bond expiration, the new bond’s effective date must match which date?

• A. The expiration date of the old bond
• B. The cancellation date of the old bond
• C. The date of license renewal
• D. The date the new bond is issued

Answer: (B)

The situation tests keeping continuous bond coverage to avoid a lapse that could suspend the license. The old bond ends at its cancellation date, so the new bond must become effective exactly at that moment. If the new bond started on the old bond’s expiration or at some other date, there could be a gap in coverage if the old bond is canceled earlier or if processing isn’t immediate. The license renewal date isn’t about bond continuity, and simply issuing a new bond doesn’t guarantee it starts right away. Set the new bond’s effective date to match the old bond’s cancellation date to ensure there’s no lapse in coverage.

The situation tests keeping continuous bond coverage to avoid a lapse that could suspend the license. The old bond ends at its cancellation date, so the new bond must become effective exactly at that moment. If the new bond started on the old bond’s expiration or at some other date, there could be a gap in coverage if the old bond is canceled earlier or if processing isn’t immediate. The license renewal date isn’t about bond continuity, and simply issuing a new bond doesn’t guarantee it starts right away. Set the new bond’s effective date to match the old bond’s cancellation date to ensure there’s no lapse in coverage.