Surety bonds • Michigan
Michigan Auto Dealer Bond: $25,000 Requirement and Cost
Michigan requires licensed vehicle dealers to carry a $25,000 surety bond under MCL 257.248. The bond protects purchasers, sellers, lessees, financing agencies, and government agencies against losses from the dealer’s fraud or misrepresentation, and covers certain sales and use tax deficiencies. Published prices start around $225 to $250 a year.
This guide covers who needs the bond, what it protects, and costs. Blake Insurance Group is an independent agency, and a licensed agent can help with your bond and dealer insurance.
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The $25,000 dealer bond
Under MCL 257.248, the dealer bond must be in the amount of $25,000. It protects a purchaser, seller, lessee, financing agency, or governmental agency against monetary loss from fraud, cheating, or misrepresentation by the dealer or its employees, agents, or salespeople, and also covers the state for certain sales and use tax deficiencies.
Who needs the bond
SuretyBonds.com reports the bond applies to new, used, and auction dealers and brokers that handle five or more vehicles in a 12-month period, along with certain parts and scrap businesses, and that the amount increased from $10,000 to $25,000 on January 23, 2023.
How much a Michigan dealer bond costs
SuretyBonds.com lists Michigan dealer bond premiums starting around $225 to $250 a year, with a typical range of about $250 to $500 based on credit.
Bond vs. dealer insurance
The bond protects customers and the state, not the dealership. Dealers usually also carry garage liability, dealer’s open lot, and commercial auto insurance. See our surety bond vs. insurance guide.
Michigan auto dealer bond FAQs
How much is a Michigan dealer bond?
$25,000. Published prices start around $225 to $250 a year.
When did the Michigan dealer bond increase?
The amount increased from $10,000 to $25,000 on January 23, 2023.
Who does the Michigan dealer bond protect?
Purchasers, sellers, lessees, financing agencies, and government agencies harmed by dealer fraud or misrepresentation.
Related guides
- Michigan surety bonds
- Ohio auto dealer bond
- Illinois auto dealer bond
- Commercial auto insurance
- Surety bonds
- Surety bond cost
- Surety bond cost calculator
- Buy a surety bond online
- License and permit bonds
- South Dakota auto dealer bond
- West Virginia auto dealer bond
- New Mexico auto dealer bond
- Nebraska auto dealer bond
- Kansas auto dealer bond
- Iowa auto dealer bond
- Oklahoma auto dealer bond
- South Carolina auto dealer bond
- Alabama auto dealer bond
- Tennessee auto dealer bond
- Washington auto dealer bond
Important information
Compensation. The link in the partner quote box near the top of this page is sponsored, and Blake Insurance Group may be paid if you make a purchase. Sponsored placement does not affect the other information on this page.
Independent agency. Blake Insurance Group LLC is an independent insurance agency. Licensed insurance producer NPN 16944666. Licensed states: AZ, AL, TX, CA, NY, OH, FL, NC, VA, GA, OK, NM, IA, KS, MI, NE, SC, SD, WV, IL, NJ, PA, TN, and WA. Which insurance companies we can quote depends on our current appointments, the product, and your state. Mentioning a company on this page does not mean we represent it.
Cost figures. Published averages and ranges are cited from the sources named, as of the dates shown. They are not quotes and may not reflect your price, which depends on the insurer, the surety, your credit, the bond type, and underwriting.
Availability. Coverage, prices, discounts, and eligibility vary by insurer, state, and applicant, and are subject to underwriting. The issued policy controls.
Your next step
Tell us about your dealership, and a licensed agent will help with your Michigan dealer bond, or start a bond quote online with our partner.
