Texas Credit Union Fidelity Bond Requirements (2026)

If you run compliance at a Texas credit union, you answer to two fidelity bond rules, not one. The federal rule sets a floor. The Texas rule sits on top of it and adds obligations the federal rule never mentions. Most of what’s written about credit union fidelity bonds covers only the first half — which is how credit unions end up compliant with the NCUA and out of step with the Commissioner.

Here’s both halves, with the citations, so you can check your own bond against them today.

First, one piece of housekeeping, because it trips up almost everyone who searches for this.

A fidelity bond is not share insurance. NCUA share insurance protects your members — up to $250,000 per member, through the National Credit Union Share Insurance Fund. A fidelity bond protects the credit union itself, against fraud and dishonesty by its own employees, officers, directors and committee members. The confusion is understandable, because the smallest bracket in the NCUA’s fidelity bond table is also $250,000. That’s a coincidence. The two figures have nothing to do with each other.

What this bond is, and what it isn’t

Most of the bonds we write are three-party instruments: a principal buys the bond, an obligee requires it, and a surety backs it. A credit union fidelity bond doesn’t work that way.

There’s no obligee. The credit union buys the policy and the credit union collects on it. It’s first-party coverage, closer in mechanics to insurance than to a surety bond — even though everyone in the industry calls it a bond and the regulation calls it a bond. Nobody is guaranteeing your performance to a third party. You’re protecting your own balance sheet against your own people.

That also means the price isn’t set the way surety premiums are set. There’s no credit-tier table here. Underwriters price a credit union fidelity bond on asset size, internal controls, examination history and prior losses.

One more distinction worth drawing, because the terms get used interchangeably and they aren’t. A bankers blanket bond — Form 24 — is the bank instrument. Credit unions use their own NCUA-approved forms. If a broker quotes you a Form 24, they’re quoting the wrong product.

How much coverage the NCUA requires

This is the table people come looking for. It lives at 12 CFR 713.5, and it’s keyed to total assets.

Total assets	Minimum bond required
$0 – $4,000,000	Lesser of total assets or $250,000
$4,000,001 – $50,000,000	$100,000 plus $50,000 for each million or fraction thereof over $1,000,000
$50,000,001 – $500,000,000	$2,550,000 plus $10,000 for each million or fraction thereof over $50,000,000, to a maximum of $5,000,000
Over $500,000,000	One percent of assets, rounded to the nearest hundred million, to a maximum of $9,000,000

Worked through: a credit union with $10 million in assets falls in the second bracket, so the minimum is $100,000 plus $50,000 for each of the nine millions above $1 million — $550,000.

Two conditions attach to whatever number you land on:

• The aggregate limit must be at least twice the single loss limit. A bond with a $550,000 single loss limit needs at least $1,100,000 in the aggregate.
• Coverage has to move when your cash does. If daily cash funds or money in transit exceed your minimum, you have 30 days to increase coverage. There’s an exception for a temporary increase caused by an unusual event.

And the minimum is a floor, not a recommendation. The rule expects the board to weigh its own risk assessment, fraud trends and loss experience in deciding whether more is warranted. A credit union with concentrated lending or a thin control environment sitting exactly at the statutory minimum is a finding waiting to happen.

What the bond has to cover

12 CFR 713.3 sets the terms of the policy itself:

• Who is covered. Fraud and dishonesty by all employees, directors, officers, supervisory committee members and credit committee members. Committee volunteers are included — that’s the part that surprises people who assume the bond follows the payroll.
• Who can write it. An individual policy from a company holding a certificate of authority from the Secretary of the Treasury. This isn’t a formality. If your carrier isn’t on the Treasury list, the bond doesn’t satisfy the rule regardless of how good the paper is.
• Involuntary liquidation. The bond must include an option for the liquidating agent to buy coverage extending the discovery period for at least one year after liquidation.
• Voluntary liquidation. Coverage must remain in effect, or the discovery period must extend, for at least four months after the final distribution of assets.
• CUSOs. You may include a credit union service organization in your bond if you own more than 50 percent of it, or if you organized it exclusively to do business with your own employees.

What Texas adds if you’re state-chartered

This is the half that goes unwritten, and it’s the half that matters if your charter came from Austin rather than Alexandria.

7 Tex. Admin. Code §91.510 requires every Texas state-chartered credit union to purchase and maintain a blanket fidelity bond covering officers, directors, employees, committee members and agents against loss from dishonesty, burglary, robbery, larceny, theft, holdup, forgery or alteration of instruments, and misplacement or mysterious disappearance.

Three things in the Texas rule differ from the federal one:

1. The amount is yours to determine. Texas doesn’t publish an asset table. The required amount is set by the credit union based on its own assessment of what would be safe and sound given its exposure to risk, subject to board approval. If you’re federally insured, this doesn’t release you from the 713.5 table — it sits on top of it. You compute the federal minimum, then ask separately whether your own risk assessment justifies more.
2. The Commissioner can order more, and the clock is 30 days. If the Commissioner determines your bond is insufficient, the board must obtain the additional coverage within 30 days of written notice.
3. The bond must contain a cancellation-notice provision. The fidelity insurer has to notify the Commissioner in writing before cancelling any or all coverage. This is a term inside the policy, not a procedure at the department. If your current bond doesn’t contain that provision, you aren’t compliant — and it’s the single most common thing we find missing when we review an existing Texas credit union bond.

A federally insured Texas state-chartered credit union owes both rules, in full. They’re cumulative, not alternatives.

Your bond form has an expiration date

Separate from your policy term, the form your bond is written on carries an NCUA Board approval that expires. This is set out at 12 CFR 713.4:

• The NCUA Board must approve all bond forms before a federally insured credit union may use them. Approved forms are published on ncua.gov and may be used without further approval.
• Approval expires ten years from the date the Board approved or reapproved the form.
• Any form approved before 2019 expires on January 1, 2029, unless the Board determines otherwise.
• You may not use a form that has been amended, or attach a document that limits coverage, without first getting Board approval.

That last point is the one that catches credit unions out. A rider added at renewal to trim a coverage the carrier no longer wants to write is exactly the kind of amendment that needs approval. Ask your carrier, in writing, which approved form your bond sits on and when that form was approved.

Deductibles

12 CFR 713.6 caps what you can carry:

Total assets	Maximum deductible
$0 – $100,000	No deductible permitted
$100,001 – $250,000	$1,000
$250,001 – $1,000,000	$2,000
Over $1,000,000	$2,000 plus 1/1000 of total assets, to a maximum of $200,000

Two qualifications. A deductible may not exceed 10 percent of your Regular Reserve unless you establish a separate Contingency Reserve for the excess — valuation accounts such as the allowance for loan losses don’t count. And a well-capitalized credit union with composite CAMELS ratings of 1 or 2 for its last two examinations may carry a deductible up to $1,000,000. If you take that higher deductible and later fall out of eligibility, you must notify your NCUA regional office within 30 days.

What your board has to do every year

12 CFR 713.2 puts recurring duties on the board, and these are the items examiners look for in the minutes:

• Review fidelity and other insurance coverage at least annually for adequacy against the credit union’s risks and the NCUA’s minimums.
• Review every application to purchase or renew the bond, and pass a resolution approving it.
• Designate a board member who is not a credit union employee to execute the agreement and its attachments.
• No board member may sign consecutive purchase or renewal agreements for the same policy. The signature has to rotate.

That last requirement is easy to breach without noticing. If the same director has signed your renewal two years running because they’re the one who always handles insurance, that’s the violation — and it’s visible in the documents an examiner is already holding.

What it costs

Credit union fidelity bonds aren’t rate-published, and any agency quoting you a firm number before seeing your financials is guessing. Pricing turns on total assets, the coverage limit you select, your deductible, your examination and loss history, and the strength of your internal controls.

In our experience placing these for Texas institutions, premiums generally fall in the range of 0.2% to 0.5% of the coverage limit annually, with smaller credit unions at the higher end of that band because the fixed cost of underwriting is spread across a smaller limit. A credit union carrying a $1,000,000 bond commonly lands somewhere in the $3,000 to $8,000 annual range. Your own number will depend on the underwriting file.

How a Texas credit union gets bonded

1. Establish your federal minimum. Run your total assets through the 713.5 table and confirm your aggregate limit is at least twice the single loss limit.
2. Run your own risk assessment. Required under 7 TAC §91.510 if you’re state-chartered, and expected by 713.5 regardless. Document it — the board resolution should reference it.
3. Submit the underwriting file. Most recent call report, three years of loss runs, internal controls questionnaire and organizational chart.
4. Confirm the form and the carrier. Check the form appears on the NCUA’s approved list and note its approval date against the 2029 expiry. Confirm the carrier holds a Treasury certificate of authority. If you’re state-chartered, confirm the cancellation-notice provision is in the policy.
5. Board resolution and signature. Pass the resolution, designate a non-employee signer, and check that the signer isn’t the same person who signed last time.

Underwriting on a new institution bond typically runs two to four weeks. Renewals and endorsements move faster. Start the renewal file 60 days out — that gives you room to fix a form or a missing provision before the current policy lapses.

Related coverage

The credit union bond sits inside a wider family of employee-crime coverage, and institutions often carry more than one:

• Financial institution bonds — the full picture for banks, thrifts and credit unions, including Forms 24, 25 and 27 and the endorsement stack.
• Employee dishonesty bonds — the non-regulated equivalent, for employers with no regulator dictating the form or limit.
• ERISA bonds — a separate federal requirement covering anyone handling retirement plan funds. Your credit union’s fidelity bond does not satisfy it.
• All fidelity bonds — every employee-theft and crime coverage we write.

Getting help with it

We’re a Texas agency, licensed here, and we write fidelity coverage for credit unions and community banks across the state. If you want a second set of eyes on the bond you already have — the form’s approval date, the cancellation-notice provision, whether your limit still matches your asset table — that review is free and it takes a phone call.

Call (281) 484-8320, or start a quote and we’ll come back to you with the underwriting list.