Product Focus - Transportation Surety Bonds (BMC-84) Is Set to Renew Soon - Do You Have a Carrier?

Property Broker bonds, also known as BMC-84 bonds, are necessary for operation as a transportation broker in the United States and are required by the Federal Motor Safety Carrier Administration (FMCSA). The bond demonstrates the financial responsibility of a broker, guaranteeing payment to motor carriers and shippers if a broker fails to comply with its contracts and agreements

This type of bond is in high demand at this time of year and Insurors Indemnity Companies is one of the few carriers that still writes it. New requirements were instituted with the signing of the MAP-21 bill, which went into effect on 10-01-2013, requiring a $75,000 bond replacing the previous $10,000 bond.

Requirements:
The following entities or individuals must have a surety bond or trust fund in effect for $75,000:

• Property brokers 
• Companies who help make shipments
• Authorized transportation carriers successful in the transporting of freight

The FMCSA will not issue a property broker license until a surety bond for the full limits of liability is in effect. The broker license has to remain in effect as long as a surety bond remains in effect and insures the financial responsibility of the broker.  Broker surety bonds are in effect continuously and require nothing at renewal but payment to the surety company for the renewal to avoid cancellation. 

Risk:
If for some reason the broker fails to pay the transportation company, the bonding company must pay. As you can imagine, the bonding company is very careful about who they insure.

Bond Term:
Annual

Underwriting:

1. Submission in E-surety /License and Permit Application
2. Company Financials
3. Ownership Information
4. Years In Business
5. MC Number if Currently Licensed

Rate:

Premium with Insurors Indemnity Companies is $3,750/year regardless if collateral is required

What if My Broker needs to get this filed ASAP?
You are in luck!

This is the one bond that the Surety Company can file online with the Federal Motor Carrier Safety Administration.  A bond will still be issued in paper form for your client to send to the FMCSA, but the bond is in place once filed with the FMCSA.

As the carrier, Insurors Indemnity Companies sends confirmation to the agent that this has taken place on the date the bond is effective.

For detailed information regarding this bond or to find out more about the submission process please email our Commercial Underwriter.