President Obama’s 2012 passage of the Moving Ahead for Progress in the 21st Century Act (MAP-21) increased the freight broker surety bond amount from $10,000 to $75,000. Brokers were given an October 1, 2013 compliance deadline with a 60-day grace period, meaning all brokers were expected to be in compliance by December 1, 2013. As a result, a large portion of the freight broker industry have surety bond renewal deadlines in October.
October is quickly approaching, so many freight brokers will need to renew their surety bond. The bonds are issued for a one-year term and need to be renewed before their renewal date to avoid a lapse in coverage. MAP-21’s 2013 compliance deadline resulted in large numbers of freight brokers with an October bond renewal date—your bond renewal date may be different if you entered the freight broker business at a different time. For example, if you started a business in May 2014, your surety bond renews annually in May.
The $75,000 required bond amount can mean high premiums for some brokers, though brokers should take advantage of the approaching renewal dates to see if they can qualify for a better bond premium. Maybe there weren’t any claims on your surety bond in the past few years, or maybe you moved to a different state—these can both result in a lower bond premium! Years of business experience and a solid financial background can also contribute to a lower premium.
You can apply for a federal freight broker bond online 24/7 or call 1 (800) 308-4358 to speak with a surety expert about the BMC-84 bonding process.
The team at SuretyBonds.com has created several helpful resources for freight brokers, including information about how to get the best rate for your surety bond. Visit our dedicated freight broker bond page, and check out these additional Surety Bond Insider articles for more information.