Freight Broker Bonds: The Difference BMC-84 and BMC-85

How One Number can Make a Big Difference

The Difference Between a BMC-84 and a BMC-85

If you've ever waited for a bus, you know how big of a difference one small number can make. While taking the No. 12 line may get you where you need to go, the No. 13 line might spit you out on the other end of town.

That's why the difference between the BMC-84 surety bond and the BMC-85 trust fund for freight brokers can be terribly misleading. While they may seem alike, and share some similarities, they are no more the same than are the two buses mentioned above. Sure they both have wheels, but when it comes to getting where you want to go, the BMC-84 is the line you want to take.

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What is a BMC-84 and BMC-85 anyway?

According to federal regulations, one must be covered either by a BMC-84 or a BMC-85 if they are to operate as a transportation broker. Both of these bonds are meant to protect the broker in case a claim is brought against him, but they go about it in different ways.

BMC-84: This form of a freight broker bond is paid for in annual fees. It also guarantees that a surety company, rather than a government agency, will process claims on the bond.

BMC-85: On the other hand, a BMC-85 is a trust fund that requires at least $75,000 worth of collateral to be posted to the government. This also means that an impersonal government agency will handle the claims against a transportation broker.

A Closer Look at the BMC-84 vs. BMC-85

As mentioned above, a BMC-85 trust fund requires all of the collateral to be posted upfront. This can tie up large amounts of capital which could otherwise be used to run the company! This option loses even more points when one stops to consider that the government will process all claims against the bond.

On the other hand, the more manageable annual payments required for the BMC-84 make it the more obvious choice – and for good reasons. In addition to the smaller annual sums, any claims will be handled by a surety company which has a greater interest in protecting your bond against unfair claims.

Additionally, a BMC-84 surety bond is approved based on one's credit history. So if you have demonstrated responsibility, then shouldn't you be treated better than the BMC-85?

Because of these combined advantages, the only scenario in which one should choose a BMC-85 is in the event that they are not approved for a surety bond. Otherwise, a BMC-84 surety bond remains the most prudent option available, and the one that makes the most sense - both financially, and in protecting yourself against possible claims.

Lance Surety’s Program

We at Lance Surety have developed an exceptionally aggressive bond program which has allowed us to instantly approve over 99% of applicants for a BMC-84 freight broker bond – and with excellent rates. You can now apply for a Freight Broker Bond without a Social Security Number!

• 99% of applicants instantly approved
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Get a Free Freight Broker Bond Quote Now

If you have decided that a freight broker bond is right for you, head over to our online application page and get a free BMC-84 bond quote today!