Connecticut Auto Dealer Bond
What is a Connecticut auto dealer bond?
The State of Connecticut Department of Motor Vehicles requires new and used auto dealers, vehicle repairers, and rental or leasing companies to be licensed and bonded. Here are the surety bond requirements:
- Motor vehicle dealer: $60,000 bond
- Motor vehicle general repairer: $25,000 bond
- Motor vehicle limited repairer: $10,000 bond
- Leasing or rental company: $15,000 bond
An auto dealer bond holds dealers and dealerships accountable to the law and industry regulations. If a dealer causes a customer financial harm by breaking the law, the customer can file a claim against the bond for compensation.
Get Your Auto Dealer Bond in Connecticut:
What does a Connecticut auto dealer surety bond cost?
Most auto dealer bond premiums can vary based on applicants’ credit scores: the higher your credit score, the lower your annual premium. If you have excellent credit, expect to pay as little as 1% or less of the total bond amount. Other factors that may impact the cost of your bond include your industry experience and business and personal financials.
ZipBonds can offer $60,000 Connecticut motor vehicle dealer bonds for as low as $375. Here are our premium rates for the other bonds:
- Motor vehicle limited repairer: $10,000 bond – underwriting required
- Motor vehicle general repairer: $25,000 bond – underwriting required
- Leasing or rental company: $15,000 bond for $225
Why are these bonds required in Connecticut?
The Connecticut Statutes require auto dealers, repairers, and leasing companies to post bonds and abide by their terms while operating their businesses. These bonds hold licensees accountable, ensuring they follow state and federal laws and industry regulations. If they break the law (and their bond contract), licensees could lose their licenses or even go out of business. Aggrieved customers can file claims against these bonds – up to the total bond amount.
How to Get Your Connecticut Auto Dealer License
Operating your dealer or repair business in Connecticut without a license is illegal. Here’s how to get your DMV-regulated auto dealer, repairer, or leasing/rental company license.
- Auto dealer’s or repairer’s license: Follow these application instructions.
- Leasing and rental company license: Complete an application, obtain a Connecticut state sales tax number from the Department of Revenue Services, and provide proof of financial responsibility.
See the DMV website for more information.
Frequently Asked Questions
How long does it take to get a Connecticut motor vehicle dealer bond?
We can’t issue bonds that require underwriting instantly. However, the ZipBonds team always strives to deliver your bond within 24 hours of application.
Those that don’t require underwriting (leasing or rental company bonds) can be issued instantly for a flat rate.
Who regulates auto dealer bonds in Connecticut?
The Connecticut DMV regulates licensing and bonding for the motor vehicle industry. If you have any questions concerning your license, contact the DMV by calling 860-263-5056 or emailing DMV.DR@ct.gov.
How do I renew my surety bond?
You must renew your bond each year by a specific date for it to remain active (and for you to maintain your business license).
If you’re buying your bond from Zip, we’ll send a reminder when the expiration date is approaching. That way, you’ll have plenty of time to renew your bond and maintain your business license.
What happens if someone files a claim on my bond?
A customer can file a claim if a dealer commits fraud or unethical or unlawful business activity. If the claim is valid, the surety may cover the customer’s losses up to the total amount of the bond. The dealer will then need to pay back the surety for the damages.
Claims can be costly and damage your reputation and ability to get licensed and bonded again, so it’s best to do everything you can to avoid them.
How can I avoid claims on my auto dealer bond?
Avoid illegal activities and fraudulent business practices to prevent claims on your bond. Pay all taxes you owe. Also, ensure you comply with your licensing regulations. If a customer complains about something, address the issue immediately to avoid complaints from turning into costly claims.
How to Get Your Connecticut Auto Dealer Bond
ZipBonds offers the fastest and most secure option for getting the surety bonds you need. Our all-digital platform is intuitive and straightforward. Apply online or call us at (888) 435-4191 to get bonded in a flash!
About ZipBonds.com
Founders Ryan Swalve and Zach Mefferd formed the vision for ZipBonds.com when they realized how overly complicated it was to help clients place surety. The frustration of being unable to incorporate the technology they’d used in other insurance-focused projects left them thinking “there has to be a better way.”
Fast forward a couple of years, and that better way is the impetus of everything we do at ZipBonds. We constantly look for innovative ways to improve the bonding process for our clients and agents. Our team comprises individuals who understand all angles of surety – for companies, agencies, and individuals. Incorporating everyone’s point of view to improve the process while simultaneously integrating cutting-edge technology is what sets our business apart.