Indiana Auto Dealer Bond

The cost of an Indiana auto dealer bond ranges from $250 to $2,500. The surety bond premium is 1% to 10% of the $25,000 surety bond required by the state. 

The premium is based on several factors, including the applicant’s assets, experience and credit scores. An applicant with a credit score over 700 qualifies for the most competitive premium rates. We provide auto dealer bonds in Indiana for applicants with scores below 599.

Applicants with a 700 or higher credit score qualify for a premium rate of 1% to 3%. With a credit score between 600 and 699, the premium rate is 3% to 5%. For credit scores below 599, the premium rate for an Indiana auto dealer bond ranges from 5% to 10%.

1. Apply for Your Bond

We make it easy to buy an Indiana auto dealer bond also known as “Indiana vehicle merchandising bond”. Take a few minutes to complete our online application to begin the process. 99% of applicants receive an immediate quote after submitting the application.

When Trent contacted our surety bond company, he was unsure of the cost of an auto dealer bond. We gave Trent an immediate quote after he applied, and he was thrilled to discover our competitive premium rates. After reviewing his instant quote, Trent paid the premium online to complete his purchase.   

2. Get a Quote

Our surety bond company always provides quick quotes to applicants. In fact, most of our customers benefit from an immediate quote after submitting the application online. For more complex situations, we’ll provide a quote within 48 hours. 

We have over 10 years of experience providing surety bonds to our customers, and work with numerous bond programs. This allows us to provide applicants with competitive bond premiums and fast quotes.

3. Purchase Your Bond

The last step is to pay your auto dealer bond’s premium. We provide our customers with a convenient online payment option. After we receive the premium payment, we’ll email the bond to you. We can also send you the bond via mail upon request. 

With your new auto dealer bond in hand, you can finalize your license application. Simply submit your bond to the state with the other required licensing documentation.

Establish dealer licensing requirements. One of these requirements is for dealerships to provide a $25,000 surety bond when applying for a new license or renewing a license. 

The licensing and bonding requirements are in place for those who sell more than 12 vehicles annually. This applies to the sale of new and used vehicles, trailers, motorcycles, ATVs, mobile homes, recreational vehicles and watercraft. 

The bond must be in favor of the Secretary of State. Before submitting the bond to the Indiana Secretary of State Auto Dealer Services Division, ensure that it is signed. The bond must be signed by both the surety’s authorized agent and the dealer’s owner or agent.

The Secretary of State should be notified at least 10 days prior to the effective date of modifications to the bond. In addition, the dealer’s license will be suspended if the bond expires and until the bond is renewed.

The motor vehicle dealer bond in Indiana remains active until the expiration date listed on the bond or until it is canceled. The expiration date is one year from the bond’s effective date. 

To avoid a dealer license suspension, the bond renewal must be received by the Secretary of State’s office prior to the expiration date. Our surety bond company will be in touch with you to renew the bond before the expiration date. At that time, we’ll provide you with an updated premium rate.

The claimant will file the claim directly with the surety bond company. The surety company then conducts a thorough investigation of the claim to determine its validity. If the claim is not validated, the surety company denies the claim.

If the claim is deemed to be valid, the surety bond company pays the claimant up to the bond’s penal sum. After the claimant is paid, the Indiana dealership is responsible for reimbursing the surety bond company in full.

The Secretary of State Auto Dealer Services Division is responsible for reviewing an applicant’s documents for a new license or a renewal. To apply for an Indiana auto dealer license, you must provide: 

• Your dealer license application
• A $25,000 surety bond
• A criminal background check
• Photos of your business location
• A zoning affidavit
• A registered retail merchant certificate
• A copy of your photo ID
• Liability insurance ($100,000 for bodily injury to one person, $300,000 for bodily injury per accident and $50,000 for property damage)
• Franchise agreement, if applicable
• Sales tax registration ID
• $30 license fee, for new applicants
• Proof of good standing with the Indiana Department of Motor Vehicles, the state police department and the Indiana Department of Revenue

Mail the auto dealer licensing documents to:

Indiana Secretary of State Dealer Division
Indiana Government Center South
302 W Washington Street, Room E018
Indianapolis, IN 46204

As of October 1, 2024, as part of its ongoing modernization efforts, bond or insurance updates must be completed online through the Dealer Portal. Following September 30, the Division will no longer accept bond or insurance updates via US mail or email.