(a) The bond provided for in AS 08.24.140 shall be in the sum of $5,000, executed by the applicant, as principal, and by a corporation that is licensed or authorized to transact business of fidelity and surety insurance within the state as surety. The department may at any time request verification of a bonding agent's authority by the main office of any company acting as surety.

(b) A licensee may, at any time, file with the department a new bond. A licensee may in lieu of a bond make a $5,000 cash deposit with the department, the deposit to be held by the department under the same terms and conditions as if bond in that amount were posted.

(c) A surety may file with the department notice of the surety's withdrawal on the bond of a licensee. Upon filing a new bond, or upon the revocation of the collection agency license, or upon expiration of 60 days after the filing of notice of withdrawal as surety by the surety, the liability of the former surety for all future acts of the licensee is terminated.

(d) The department shall immediately cancel the bond given by a surety company upon being advised its license to transact business of fidelity and surety insurance has been revoked by the state.

(e) Upon the filing with the department of notice by a surety of the surety's withdrawal as the surety on the bond of a licensee or upon the cancellation by the department of the bond of a surety company as provided in this section, the department shall immediately give notice to the licensee of the withdrawal or cancellation. The notice shall be by registered or certified mail with request for a return receipt and addressed to the licensee at the licensee's main office, as shown by the records of the department. At the expiration of 30 days from the date of mailing the notice, the license of the licensee is terminated unless the licensee has filed a new bond with a surety satisfactory to the department. All bonds given under this chapter shall be filed and held in the office of the department.

(f) The bond required by this section remains in effect until cancelled by action of the surety, the principal, or the department. An action may not be initiated upon the bond after two years from its cancellation.