Freight Broker Bonds (BMC-84) are necessary for operation as a transportation broker in the United States, and are regulated by the Federal Motor Carrier Safety Administration (FMCSA). The bond demonstrates financial responsibility of a broker, guaranteeing payment to motor carriers and shippers if a broker fails to comply with its contracts and agreements.
With the signing of the MAP-21 bill, property brokers and freight forwarders have been required to post a $75,000 bond since Oct 1, 2013, which is a significant increase from the previous $10,000 bond. Brokers that do not comply with the new bond requirement may have their broker authority revoked by the FMCSA.
Also referred to as Interstate Commerce Commission (ICC) Bonds, Property Broker Bonds, and Transportation Broker Bond.
Questions about Freight Broker Bonds
- How much does a Freight Broker Bond cost?
- Can I get a BMC-84 Bond if I have bad credit?
- Will I have to post collateral?
- Do I need a Motor Carrier (MC) Number before applying?
- How are BMC-84 Bonds filed?
- What should I do if there is a claim against my BMC-84 Bond?
- If my credit improves, will my renewal rate be lowered?
- What is the Household Goods Broker Bond?
How much does a Freight Broker Bond cost?
Annual premium for the $75,000 BMC-84 Bond currently range between $1,300 and $9,000.
Rates are determined based on owner personal credit and time in business. A company’s financial strength can also be taken into consideration. Read more.
Can I get a BMC-84 Bond if I have bad credit?
Yes. While many sureties only offer quotes to customers with stellar credit, Lance Surety has a specialty program that allows us to approve over 99% of applicants instantly through our online application. Your annual premium will depend on your individual credit profile.
To learn more about our programs, view our section about getting bonded with bad credit.
Will I have to post collateral?
At this time, our bond approvals for BMC-84 Bonds do not require collateral. With our exclusive bad credit programs, we are able to offer quotes to freight brokers with just an annual premium requirement.
Do I need a Motor Carrier (MC) Number before applying?
No. You can apply for this bond before being assigned an MC Number. However, the surety company will need an active MC Number in order to properly file your bond with the FMCSA.
How are BMC-84 Bonds filed?
Freight Broker Bonds are electronically filed with the FMCSA, so you don’t have to worry about additional paperwork. Once the FMCSA approves your bond, you will be provided with the electronic filing confirmation, and within 24 hours will be able to view your active bond coverage on the FMCSA website.
For your reference, here is a blank copy of the bond form: FORM BMC-84
What should I do if there is a claim against my BMC-84 Bond?
Bond claims must be taken very seriously, as having a paid claim on your record may not only affect your ability to be bonded now, but also in the future as well.
If you are made aware of a claim there are a few actions you can take. Contact your bond agent right away so they are kept in the loop. If a claim was already placed against the bond, chances are your bond agent will be able to provide you with important information regarding what the claim was for and who place it. Next, contact the claimant right away to see if the issue can be resolved on your level without further incident. In most cases, claims are a result of poor communication with shippers and motor carriers regarding payment. Once the issue is resolved, provide documentation to your bond agent and the surety, and you should be all set.
If my credit improves, will my renewal rate be lowered?
Yes, a higher credit score can certainly help to lower your renewal rate. However, a better score does not guarantee a lower rate. In addition to FICO score, renewal premiums will also depend on collections and public records on your credit report, and updated surety underwriting guidelines for your specific bond type.
What is the Household Goods Broker Bond?
Since early 2012, the FMCSA has required all Brokers of Household Goods to post a $25,000 BMC-84 Bond. Brokers that arrange the transportation of household goods in interstate or foreign commerce must furnish a new bond or arrange to have their current BMC-84 Bond increased. More specific information can be obtained from the FMCSA website.