Transportation Bonds

April 1, 2022

Merchants Bonding Company provides surety bond coverage specific to the transportation industry. There are transportation bond requirements in nearly every state, from federal to local municipality obligations.


The freight broker bond is a type of surety bond needed for the brokering of freight. The Federal Motor Carrier Safety Administration (FMCSA) refers to these bonds as property broker bonds, where the property is the freight. They may also be known as ICC, FMCSA, or BMC-84 bonds. The bond protects both the owner of the freight and the shipping company. The FMCSA requires that all interstate motor carriers in the business carry a $75,000 surety bond.


The Department of Defense (DOD) oversees the Surface Deployment and Distribution Command (SDDC), which requires two types of bonds: personal property carrier bonds and freight carrier bonds. Merchants issues these bonds directly with the obligee.

The personal property carrier bond guarantees the performance and fulfillment of military personal property transported between military bases. The domestic bond is fixed at $50,000 and the international bond is fixed at $150,000.

The freight carrier bond secures the performance and fulfillment of carrier obligations to deliver DOD freight. The bond amount can vary in the amounts of $25,000, $50,000, or $100,000.


A fuel tax bond is a financial guarantee bond that ensures the payment of taxes and fees to the state government by fuel
sellers or manufacturers.

Fuel tax bonds may also be required for fuel suppliers, importers, exporters, distributors, blenders, convenience stores, and users of various types of fuel.


Transportation service businesses, like school bus operators, may need a non-construction performance (NCP) bond. As outlined in the contract document, service contract bonds guarantee the principal will perform a specific service, at a set price, for an agreed upon time period.


Oversize permit bonds protect the highways and infrastructure that a large commercial operator may use. They guarantee that the commercial operator will be held financially responsible for any damage of roadways, bridges, or other infrastructure while using permitted routes. They may be needed at the state or local municipality level and may also be known as superheavy bonds or overweight permit bonds.

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