Getting to know Texas Freight Broker Surety Bonds
The industry of freight brokerage is both regulated and mandated federally. This brings the Texas freight brokers, along with the freight brokers of the country itself, under the administration of the FMCSA (Federal Motor Carrier Safety Administration). Despite being managed federally, Texas freight brokers should know their way around the state’s laws.
The Texas freight broker surety bonds are required for licensing by the FMCSA.
The Texas freight broker bond is purchased for a sum of $75,000.
The main purpose of the Texas freight broker surety bond is it’s requirement for licensing by the FMCSA, who won’t issue a license without this bond. It is also guarantees, financially, that they, by virtue of being the state’s freight brokers, will abide by its laws and rules.
This bond also serves to protect others, namely consumers, from fraudulent acts, freight brokers wilfully neglecting their deals, or any other activity which may be deemed criminal, committed by the broker or any of their employees. It is to be noted that it protects the consumers from the freight broker’s illegal activities; it does not protect the freight broker at all.
The duration for which a Texas freight broker surety bond is issued is one year.
It is to be kept in mind that the duration of the bond must run parallel with the license of the freight broker. Not doing so may lead to a lapse in coverage, which could be a potential cause for the suspension of the lease.
The price of a Texas freight broker surety bonds are $75,000, per bond, as mentioned earlier. Ideally the premium is a small percentage of the value of the bond. This may be as low as $1,500 annually. The credit score of the applicant is almost entirely responsible for determining the premium amount of the surety bond.