Dealer Bond in West Pompano Beach, FL
Dealer Bond Insurance, commonly referred to as a Motor Vehicle Dealer Bond or Auto Dealer Bond, is not technically insurance—it’s a surety bond required by most states for individuals or businesses that sell vehicles.
What It Is:
A dealer bond is a financial guarantee that protects the public and the state from fraudulent or unethical business practices by the dealer.
Key Roles in a Dealer Bond:
- Principal – The auto dealer (you)
- Obligee – The state government or licensing authority
- Surety – The bond company that guarantees the dealer’s obligations
What It Covers:
- Misrepresentation of a vehicle’s condition or title
- Failure to pay taxes or fees to the stat
- Violations of dealership laws or licensing requirement
- Breach of contract with consumers
How Much Does It Cost?
- Bond amounts vary by state (commonly $10,000 to $100,000)
- You pay a premium, usually 1–10% of the bond amount annually, depending on your credit and business history
Required For:
- New and used car dealers
- Motorcycle and RV dealers
- Wholesale or auction dealers (varies by state)
Important:
- A dealer bond is mandatory in most states to get or maintain your dealer license.
- It does not protect the dealer—it protects customers and the state.
Need help figuring out what applies to your situation? Contact us today—we’re happy to walk you through it!