Indiana Motor Vehicle Merchandising Bonds (Motor Vehicle Dealer Bonds)

Get a Free Quote for Your Indiana Motor Vehicle Dealer Bond Today

Who Is Required To Purchase an Auto Dealer Bond In Indiana?

Here are the eight classifications that require this surety bond to get licensed:

• Manufacturer
• Auto auction dealer
• Automotive salvage recycler
• Converter manufacturer
• New and used vehicle dealer
• Distributor (wholesaler)
• Transfer dealer
• Watercraft dealer

Each Indiana Dealer License Is Independent

This means each license has its own licensing requirements and you can't combine any if you're seeking multiple licenses.

This includes the bond requirement. If you are seeking multiple licenses, you will need to purchase a separate bond for each license.

Why is an Indiana Motor Vehicle Dealer Bond Required?

The Division's goal is to license only the most qualified dealers to search the Indiana public. That's why they continue to update the licensing process.

And yet, obtaining a license does not mean every dealer is reputable. Each year there will be licensed dealerships who purposefully harm their customers financially to increase profits.

Examples of these fraudulent actions include:

• Improperly transferring a title
• Selling vehicles with no title
• Misrepresenting vehicle information like mileage, manufacture year, or condition
• Stealing customer deposits
• Failing to pay the correct sales taxes to the Indiana Department of Revenue

The auto dealer surety bond requirement is the primary method the Division has to protect the public and the Indiana Department of Revenue from these fraudulent dealers

If a customer is harmed by any of these actions, they can make a claim against the dealer bond for financial compensation. However, the maximum compensation available is capped at the bond amount.

What is the Indiana Auto Dealer Bond Amount?

Unlike most states, Indiana has one bond amount for each license. This makes it easy to and predictable for pricing.

The bond amount is $25,000. TABLE

Again, this bond amount means a large claim against a dealer is capped at $25,000.

The cost to purchase a $25,000 bond will be a small fraction of this amount.

How Much Does an Indiana Auto Dealer Bond Cost?

How an Auto Dealer Bond Price Is Determined

Indiana auto dealer bonds are credit driven. This means a surety will have to provide you with a customized quote.

A surety is an insurance company that underwrites vehicle dealer bonds and they typically consider these primary factors when determining their rate:

• The personal credit of the owner and/or owners
• Auto dealer industry and experience
• Prior bond claims if owners have been licensed in the past

BOX: The rate multiplied by the $25,000 bond amount is the price you'll pay.

This is where you can save hundreds of dollars purchasing your auto dealership bond.

Using a Specialized Surety Agency to Find the Lowest Price

Surety Bonds Direct is a specialized surety agency and as an agency we work with A rated sureties to find our customers the lowest possible price.

While every surety uses similar factors to determine their rate, the actual rates quoted can vary by one, two, even three percentage points.

Let's look at some pricing examples so you can see how big of a difference just one or two percentage points can make to the price.

Here are examples for the used dealer bond with the amount of $25,000.

You can see how a rate that is one two two percentage points different can save you considerable money. This is enough to pay all of the required fees to get licensed and have some money left over for dealer plates.

Click here and have us price shop for you.

Or call a bond specialist at 1-800-608-9950.

There is no cost and no obligation to purchase when you request pricing. Get the information you need to finish off the licensing process.

How Long Does an Indiana Auto Dealer Bond Last?

The Indiana vehicle dealer bonds have a bond term of 12 months from the effective date. The effective date is the active date you choose when you purchase your bond.

Before your bond expires, you must renew it to keep it active. The Division requires an active bond to be on file for as long as you plan to stay in business.

This is another great reason so choose a surety agent like Surety Bonds Direct when purchasing your bond.

You're assigned a bond specialist who manages the process for you.

Your bond specialist will contact you 30 to 45 days in advance to make sure the renewal premium is paid on time so your bond remains active.

Once you pay the renewal premium, you don't have to do anything else. Your bond is active and you can continue selling vehicles.

Motor Vehicle Dealer Bonds And Getting Your Indiana Business License/Registration

Make sure you read our blog post about the steps to get your Indiana dealer license. While the Secretary of State has great instructions, our post just fills in the gaps with explanations for many of the common questions.

At a high level, the steps for obtaining your dealer licensed are:

• Decide on your license classifications or classification
• Determine your ownership details and identities
• Purchase your surety bond
• Get your dealership license plates
• Fulfill all of the dealership and property requirements
• Complete your application

Additional Indiana Motor Vehicle Dealer Bond Resources & Links

Indiana Secretary of State Auto Dealer Services Division

Indiana Vehicle Merchandising Bond Form