Why a Notary Bond?
A notary is an appointed position by the Secretary of State’s office in a given state. As with most public officials, the State requires that the individual obtain a notary bond before receiving their commission. This bond “makes sure” that when the notary violates the public trust through negligence of their responsibilities, funds are set aside to reimburse the State for its loss.
The principal duty of notaries public is to ensure that the individual parties to an agreement are who they claim to be. The State may suffer a loss if the notary fails to properly validate the identity of the parties.
As a public official, the notary public causes harm to the public trust by failing in their duty to confirm identity. If a Mississippi notary public doesn’t confirm identity and a loss occurs, an injured party can file a claim against that State for the loss, because the State was negligent through its appointed representative.
A surety bond is a promise to pay to the obligee (the State) if losses occur for a penalty amount of the bond. Notary Public bonds are often provided by a surety company (typically an insurance carrier). The bond often runs concurrently with the term of the notary’s commission.
You’re probably familiar with a home insurance policy. When a person has an Indiana home insurance claim, the insurance carrier pays the claim and writes off the loss. You aren’t required to reimburse the carrier for the loss. Unlike a home insurance policy however, a notary bond is simply a promise that the finances will be available when losses occur. The surety (insurance company) pays the State up to the penalty amount of the bond. However, this claim paid by the company is not simply written off. The carrier will most likely seek reimbursement from the bonded person, the notary themself.
A notary bond protects the public. Who protects the notary? Insurance coverage is available to provide this protection – it’s called Notary Public Errors and Omissions and can also be obtained for a nominal fee from insurance carriers.