Freight Broker Bonds
What is a Freight Broker Bond?
The Federal Motor Carrier Safety Association (FMCSA) requires freight brokers to obtain a bond in order to get or renew a license. Freight Broker Bonds protect shippers/motor carriers from non-payment. If the Freight Broker doesn’t pay the shipper/motor carrier, the surety company steps in and pays them, then the Freight Broker must pay back the surety company.
How does a freight broker bond work?
BMC-84 bonds are mandated by the federal government to ensure that freight brokers will abide by the FMCSA (Federal Motor Carrier Safety Administration) rules and regulations.
If a Freight Broker fails to follow FMCSA rules, a claim can be filed against the bond. The bond principal (person paying the premium on the bond) will be responsible for paying the claim amount.
Claims can be filed by one of four parties: the shipper, the owner of the good, the consignee, or the carrier.
What does a Freight Broker Bond Cost?
The cost of a freight broker bond is typically $938 to $9,000, or ranges from the equivalent of 1.25-12% of the bond amount. Freight broker bond pricing is based on the financial strength of a company or personal credit.
How do I get a freight broker bond?
The first requirement is registering with the FMCSA to obtain freight broker authority. Once registered, the next step is to contact a bonding company.
How to Choose a Bonding Company?
Universal Service Agency offers Surety Service Made Simple. We are the fastest surety only agency in the country, with over 100 years of combined surety experience servicing all 50 states. We exhaust all of our resources to get you the fastest turnaround times and lowest rates. We can help anyone, even clients that may not fit into the standard market. You can get a free quote here or call our bond experts at 215-646-2400.
How long does it take to get a freight broker bond?
Universal can issue bonds the same day an application is received. The amount of time between application and issuance is affected by a number of factors though, including but not limited to, the size of the obligation, the type of bond, and promptness of the premium payment.
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Universal Service Agency is the fastest “surety only” agency in the country, with over 100 years of combined surety experience servicing all 50 states.