FMC 84 Freight Forwarder Bond
What is a freight broker bond?
A freight broker bond, also known as a BMC-84 bond, is required by the Federal Motor Carrier Safety Administration (FMCSA) for transportation or freight brokers to be licensed.
The freight broker license bond protects shippers and motor carriers and helps ensure that contractual agreements between freight brokers and shippers/carriers are kept.
Freight brokers in the United States are required to hold a bond amount of $75,000.
How much does a freight broker bond cost?
In general, the cost of a freight broker bond begins at 1.5% of the full bond amount. The premium can vary depending on your credit score or financial strength.
If your credit or financial strength is strong, your premium can be as low as $938. However, if it is not in good standing, the premium you pay would be a higher percentage.
Why do I need a freight broker bond?
To legally provide freight services in the United States, the Federal Motor Carrier Safety Administration requires those operating as transportation or freight brokers to be bonded.
The freight broker bond requirement is an important part of your initial licensure and renewal process. Failure to follow this requirement can result in your brokerage authority being revoked by the FMCSA.
How does a freight broker bond work?
This bond ensures that the contractual agreements you make with shippers and carriers (your customers) are kept.
Should a freight broker violate FMCSA regulations, the bond will serve as a form of credit for the broker.
For example, if you, the freight broker, fail to deliver payment to a shipper or carrier for their services, the shipper or carrier can file a claim against your bond to receive payment. If the claim is upheld, the surety company that issued your bond will make the payment, and you will then be required to pay back the surety.
How can I get a freight broker bond?
To get a freight broker bond, you must:
- Apply for freight brokerage authority through the FMCSA by filing an OP-1 form.
- Purchase your $75,000 freight broker bond with us. (We'll electronically upload your bond to the FMCSA on your behalf.)
- Submit a BOC-3 Designation of Process Agent Form.
- Pay a non-refundable application processing fee of $300 to the FMCSA.
What else should I know about freight broker bonds?
This surety bond for freight brokers, formerly known as the Interstate Commerce Commission (ICC) Bond, may also be referred to as the BMC-84 Freight Broker Bond, Transportation Broker Bond, and Property Broker Bond.
It is required by the FMCSA that all freight brokers in the United States carry a surety bond in the amount of $75,000. To get your bond, you must complete the FMCSA’s required steps listed on their website.
For more information on freight broker bonds and to get a free quote, contact NNA Surety Bonds at 855-518-1227.