No, the premium is not returned because it is a fee used to obtain the surety bond. This is a one-time charge and only costs a fraction of the security deposit.
If you have caused damage or have unpaid rent, the property company has a right to be indemnified for any losses up to the bond amount. If your bond amount is $1,000, you can be subject to claims up to that amount. You will have to pay for these charges if you are liable.
If no damage or unpaid rent has accrued, your obligations under the bond are completed. Your property manager can provide confirmation of this after you move out.
The bond costs 17.5% of the bond amount (the security deposit amount). This is a one-time charge for the length of your tenancy. In other words, you pay a small amount now instead of having thousands of dollars tied up in a security deposit. The cost is on per apartment basis, so if you have roommates, splitting the cost of the bond lowers the individual cost.
These financial agreements are used in place of traditional security deposits. The Principal (you) pays the Surety (Insurance Company) a small premium to get access to the insurance company’s creditworthiness up to the Bond Amount (Security Deposit). This bond guarantees the Obligee (Property Company) that it will not suffer financial loss due to your negligent behavior such as damaging an apartment beyond normal wear and tear or not paying rent.
