Indiana Motor Vehicle Merchandising Bonds (Motor Vehicle Dealer Bonds)
Indiana Motor Vehicle Dealer Bond Information
A $25,000 vehicle merchandising surety bond is required by the Indiana Secretary of State for various motor vehicle industry professionals. The surety bond must be posted by businesses holding the following vehicle industry license types in order to legally operate in the state.
- Automobile Auctioneer
- Dealer (Auto Dealers)
- Wholesale Dealer
- Watercraft Dealer
- Research and Development
- Converter Manufacturer
- Automotive Salvage Recycler
- Transfer Dealer
- Auto Mobility Dealer
What Does a Motor Vehicle Dealer Bond Protect Against?
The surety bond protects third parties who suffer financial damages as a result of the bonded principal’s noncompliance with any provision of law, ordinance, or resolutions governing issuance of the license by the Indiana Secretary of State. Damages may include nonpayment of fines, penalties, costs and fees due to the State or other damages sustained by aggrieved individuals.
In a situation where the bonded customer (principal) fails to comply with surety bonding terms and requirements, the surety company is financially obligated to cover damages up to the bond amount or penal sum of the bond. As with all surety bonds, the principal agrees to indemnify the surety for any such losses paid to third parties.
The bond may be canceled by the surety company at any time by providing 30 days advance written notice to the Secretary of State.