Texas Health Spa Surety Bond
Texas health spas generally must register with the Texas Secretary of State. Unless an exemption applies, the business must also provide security for each registered location.
A surety bond is one way to satisfy that requirement, with required security amounts ranging from $20,000 to $50,000.
Who Is Considered a Health Spa?
Texas defines a health spa generally as a business that sells memberships providing instruction in, or use of, facilities for a physical exercise program.
Registration Is Generally Required
A person generally may not operate a health spa or offer or sell a health spa membership unless the operator holds a health spa operator’s certificate of registration from the Texas Secretary of State.
Registration is required for each health spa location.
Some Businesses Are Excluded
The statutory definition excludes certain organizations and activities, including some nonprofit organizations, member-owned private clubs, businesses operated exclusively for dance or aerobics instruction, certain rehabilitation activities and some activities already regulated under another state license.
If you are unsure whether Chapter 702 applies to your business, verify your status with the Texas Secretary of State.
What Does the Health Spa Bond Protect?
The security requirement is designed to protect members who may suffer financial loss if a health spa closes.
The Bond Is Not Insurance for the Health Spa
A surety bond provides financial protection for qualifying consumers under the terms of the Texas Health Spa Act and the bond. If the surety pays a valid claim, the bonded business may be responsible for reimbursing the surety.
How Much Health Spa Security Is Required?
Texas bases the required amount on the total amount paid for prepaid memberships at each health spa location.
| Total Amount Paid for Prepaid Memberships | Required Security |
|---|---|
| $0 – $20,000 | $20,000 |
| $20,001 – $25,000 | $25,000 |
| $25,001 – $30,000 | $30,000 |
| $30,001 – $35,000 | $35,000 |
| $35,001 – $40,000 | $40,000 |
| $40,001 – $45,000 | $45,000 |
| Over $45,000 | $50,000 |
Security Is Required Per Location
If the operator has multiple health spa locations, the security requirement is determined separately for each location. Use the amount required by the Texas Secretary of State for the specific registered location.
Surety Bond or Certificate of Deposit?
Health Spa Surety Bond
A surety bond allows a qualifying business to satisfy the security requirement without placing the entire bond amount into a certificate of deposit.
The surety determines the premium based on underwriting and the required bond amount.
Find Health Spa BondCertificate of Deposit
Texas also permits the security requirement to be satisfied through a certificate of deposit assigned in favor of the Texas Secretary of State.
Form 3004 is used for the assignment of a certificate of deposit as security.
Some Registered Health Spas May Qualify for an Exemption
Short-Term / No Long-Term Commitment Exemption
A certificate holder may apply for an exemption when the business does not require or offer certain long-term financial commitments.
Examples identified by the Secretary of State include contracts longer than 31 days, recurring bank drafts, initiation fees other than monthly dues, installment contracts or prepayment beyond 31 days.
Established Business Exemption
Another exemption may apply to qualifying established health spas that meet statutory financial, ownership or management-history and complaint-history conditions.
Businesses seeking an exemption generally use Texas Secretary of State Form 3006.
An Exemption Is Not Automatic
Do not assume that your health spa is exempt simply because memberships are month-to-month or because the business has operated for several years. Confirm the exemption with the Texas Secretary of State and file the applicable exemption documentation.
Accepting Membership Payments Before Opening?
Additional Escrow Requirements May Apply
Texas has separate requirements for a health spa that accepts prepaid memberships before the location opens.
The Secretary of State states that an escrow account may be required and must generally be established with an FDIC-insured financial institution no later than the 14th day after the first prepayment is accepted.
This escrow requirement is separate from the health spa surety bond requirement.
How to Obtain a Texas Health Spa Bond
Determine the Bond Amount
Confirm the amount of security required for the individual health spa location.
Start the Bond Application
Open our surety platform, select the Health Spa Bond product and complete the requested information.
Obtain the Bond
Once approved and issued, review the bond carefully to make sure the health spa name and location match the registration application.
File With the State
Submit the required proof of security with the health spa registration documents as directed by the Texas Secretary of State.
Verify Your Registration Requirement
The Texas Secretary of State administers health spa registration and security filings. For regulatory questions, verify your requirement directly with the state.
Texas Health Spa Bond FAQs
Does every Texas health spa need a surety bond?
How much is a Texas health spa bond?
Is the bond amount the same as the bond premium?
Do I need a separate bond for each health spa location?
What is Texas Health Spa Form 3002?
Can I use a certificate of deposit instead of a bond?
Can a health spa qualify for an exemption from the security requirement?
What if I sell memberships before my health spa opens?
What happens when I click the application button?
Who regulates Texas health spa registrations?
Ready to Apply for Your Health Spa Bond?
Confirm the required bond amount for your health spa location, then open our surety platform to begin the application.
Bond approval and premium are subject to surety underwriting. Registration, security and exemption requirements are determined by the Texas Secretary of State.