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How much does a freight broker bond cost?
Freight broker bond costs start at $938 for the FMCSA's required 1-year term. Rates for BMC 84 surety bonds vary by state and individual applicant. Your freight broker bond cost will be a percentage of the $75,000 bond amount as determined by an underwriter. Unlike other surety providers, SuretyBonds.com never charges additional or hidden fees.
Established freight brokers or forwarders might qualify for a lower rate if they've previously worked in the transportation broker industry.
How do you apply for a freight broker bond?
You can apply for your freight broker or forwarder bond online 24/7 through our safe and secure application portal. If you're starting a new freight brokerage without finalized company information, you can just enter your personal information to get your free quote. If you need a bond for an existing company, you'll provide your company information and 6-8 digit motor carrier (MC) number as it's currently filed with the FMCSA.
How fast can I get a freight broker bond?
SuretyBonds.com makes the bonding process as fast, easy, and affordable as possible. Our industry-leading technology and responsive customer service team allow us to offer free quotes and electronically file BMC-84 surety bonds directly with the FMCSA faster than any other surety provider. Once your payment has been processed, your freight broker surety bond will be filed directly with the FMCSA electronically on your behalf.
If you have any questions about the FMCSA freight broker or forwarder BMC-84 bond or your application, call 1 (800) 308-4358 to speak with one of our friendly surety experts. We're here to guide you through the broker bond process so you can get back to running your business.
What is the purpose of a freight broker surety bond?
Title 49, U.S.C. 13904 requires all freight brokers and freight forwarders file either a surety bond (BMC-84) or a trust fund agreement (BMC-85). Freight broker bonds are also known as the BMC 84 bond or the ICC broker bond. The BMC 84 surety bond ensures licensed freight brokers and forwarders adhere to all applicable laws and regulations.
Freight broker license bonds are valid for 1 year from the date filed. If either the broker or surety company wishes to cancel the bond, the surety company must provide a 30-day notice of cancellation to the FMCSA.
Watch the video below for more information about FMCSA's $75,000 surety bond licensing requirement for freight brokers and freight forwarders.
Who regulates freight brokers?
The Federal Motor Carrier Safety Administration (FMCSA) regulates freight brokers and forwarders in the shipper and truck transportation industry. As part of its freight brokerage operating authority registration, freight brokers and forwarders must file a $75,000 surety bond to register with the FMCSA before beginning business operations and arranging for the transportation of goods.
What is the required freight broker bond amount?
The BMC 84 bond amount is $75,000, which freight brokers and freight forwarders must file before receiving their operating authority. The Federal Motor Carrier Safety Administration increased the surety bond amount requirement from $10,000 to $75,000 on October 1st, 2013.
What does a freight broker bond cover?
If freight brokers or forwarders fail to comply with the terms of the surety bond, parties that suffer damages as a result can file a claim against the bond. The surety company will settle valid claims up to the total bond amount. License holders must reimburse their surety company for any claims paid out. The most common reason for claims occurs when motor carriers fail to pay their business partners in a timely manner as originally contracted.
How do you file a freight brokers bond?
The (FMCSA) now requires all information from the surety company be submitted electronically. Physically issued and filed paper bond documentation is no longer required. Your surety company will file your bond for freight broker license operating authority electronically directly with the FMCSA on your behalf.
How do I update or change my freight broker bond?
If the FMCSA requires your BMC 84 surety bond be updated for any reason, contact your bond company as they will need to file the change directly with the FMCSA electronically. If you purchased your bond from SuretyBonds.com, email [email protected] to explain the needed change.
The most common changes for these bonds include:
- updating the freight broker or forwarder company name
- updating the motor carrier MC number associated with the bond
How do I renew my freight broker bond?
Freight broker bonds must be renewed whenever the current annual term expires. Once you pay your SuretyBonds.com renewal invoice, our team will verify your company's active bond renewal status with the FMCSA.
How do you obtain freight broker authority?
To become a licensed freight broker, applicants must complete the following steps as required by the FMCSA.
- File OP-1 Application for Motor Property Carrier and Broker Authority.
- Provide $75,000 BMC-84 surety bond or BMC-85 trust fund agreement.
- Submit BOC-3 (Designation of Process Agent).
- Pay nonrefundable $300 filing fee.
The FMCSA requires freight forwarders file additional insurance submitted on the following forms.
- Liability insurance: BMC-91 or BMC-91x (if insurance is provided by multiple companies)
- Proof of cargo insurance (if you are a household goods freight forwarder): BMC-34 or BMC-83
Applicants may submit the OP-1 form to the FMCSA online or through mail. The FMCSA currently estimates 4-6 weeks for application processing. To expedite operating authority approval, applicants should verify the accuracy of all provided information. Applications with incomplete or missing information will likely be rejected.
What is the BMC 85 trust fund agreement?
In lieu of a bond, brokers, forwarders, and carriers can choose to place $75,000 into a trust fund by filing form BMC-85. This alternative security option requires full collateral up front, so often only large freight brokerages with strong personal credit and established financial stability choose this option. New companies and individuals with bad credit typically choose to purchase and file a surety bond since it only requires annual premium rather than $75,000 worth of collateral.