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Indiana Auto Dealer Bond

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What is an Indiana Auto Dealer Bond?

Any auto dealer operating in Indiana must have a valid license to operate their business legally. Indiana auto dealers must also secure an Indiana auto dealer bond as part of their business requirements.

An Indiana auto dealer bond is a type of surety bond that protects the state and the dealer's customers from fraudulent or misleading business practices. Should a claim be made against an Indiana auto dealer bond, compensation is paid to the state or the customer harmed in the transaction with the auto dealer.

How Does an Indiana Auto Dealer Bond Work?

As a type of surety bond, an Indiana auto dealer bond consists of three main players.

The Obligee

The obligee of the bond is the state's licensing authority that requires the bond be obtained.

The Principal

The principal of the bond is the auto dealer required to secure a bond as part of the state's licensing requirements.

The Surety

The surety company provides the bond on behalf of the principal and pays any claims filed against the bond. The principal then repays the claim over time to the surety.

Indiana Auto Dealer Bond Obligee Details

The obligee for Indiana auto dealer bonds is as follows:

Indiana Secretary of State

Dealer Division

Indiana Government Center South

302 W Washington Street, Room E018

Indianapolis, Indiana 46204

Who Needs an Indiana Auto Dealer Bond?

As with many states, auto dealers are defined as individuals or business entities engaging in the business or selling or purchasing motor vehicles for a profit.

In Indiana, this includes wholesale dealers, transfer dealers, distributors, manufacturers, auctioneers, and retail dealers. Each type of auto dealer is required to have an Indiana auto dealer bond.

How do You Get an Indiana Auto Dealer Bond?

To get started with an Indiana auto dealer bond, a brief online application can be submitted. The surety company needs information about the bond type and amount required, as well as financial details for the auto dealer. Once these details are reviewed, a quote is provided for the Indiana auto dealer bond.

How Much Does an Indiana Auto Dealer Bond Cost?

All auto dealers in Indiana must post an auto dealer bond of no less than $25,000, regardless of the type or amount of vehicles sold, but the total bond amount is not the price paid for an Indiana auto dealer bond.

The out-of-pocket cost for a bond, known as the bond premium, is calculated as a percentage of the bond total. The bond premium typically ranges from one to 10 percent of the $25,000 bond amount.

Can I Get an Indiana Auto Dealer Bond with Bad Credit?

Indiana auto dealers must undergo a credit check to determine the price of the bond premium. A credit check is required because the surety company takes on risk when issuing a new bond.

If an auto dealer has a questionable financial track record or bad credit, the bond premium may be higher than an auto dealer who has a strong credit history.

How Do I Renew My Indiana Auto Dealer Bond?

Each auto dealer bond is issued for a one-year term, and it must be renewed every year if the auto dealer wants to remain compliant with state laws. The state will send out renewal reminders before your bond’s annual expiration date, and it is your job to ensure you submit your renewal before it expires.


Frequent Questions

What does an auto dealer bond cost?

Costs are a percentage of the auto dealer bond amount that's required of you, which is based on your personal credit. Use our bond pricing tool to get a quick ballpark estimate.

Can I get a bond with bad credit?

Yes. You can get approved for a bond regardless of your credit situation. However, the price will increase. You can apply to get an instant approval. As the largest writer of surety bonds in the U.S., we have access to high risk markets that many other agencies do not.

How long does the application take?

It only takes minutes, as we can approve you for your bond instantly online. You can get a no obligation quote on our website at any time.

Can I get auto dealer bond insurance to protect myself?

No. An auto dealer bond does not protect you, it protects the public. However, you can protect yourself or your customers by getting fidelity bonds.


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Jennifer Henson
Our company has been with JW Surety for several years now so when we needed to obtain a bond for a new company, we immediately went to them for help. Our rep, Melissa, was extremely helpful and prompt which made the process extremely easy for me.
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Trying to get a local Surety Bond was like driving a car on three tires. I searched Surety Bonds and found JW Surety Bonds. I got online and filled out the information and with in 30 minutes received a response from Melissa. She was informative, friendly and helpful. One more super satisfied customer.

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About JW Surety Bonds
We are a family owned and operated agency established in 2003. We started with just two people, and grew to become the largest volume bond producer in the nation with 50+ employees. Since day one, our team focus has been on providing real-time online quotes, an easy process, and the best in claims defense. Learn more about our company.