Motor Vehicle Dealer Bond in Kansas

What this bond requires in Kansas

Kansas requires a $50,000 corporate surety bond for vehicle dealers under K.S.A. 8-2404, executed in the name of the State of Kansas and conditioned on compliance with the Vehicle Dealers and Manufacturers Licensing Act. Applicants may instead deposit $50,000 in cash or approved securities with the State Treasurer in lieu of a surety bond. The aggregate liability of the surety cannot exceed the bond amount, and the surety may cancel the bond on 30 days written notice to the Director of Vehicles. First and second stage manufacturers, factory branches, factory representatives, and salespersons are exempt from the bonding requirement.

Who requires it

The motor vehicle dealer bond is required by the Kansas Department of Revenue, Division of Vehicles - Dealer Licensing Bureau under K.S.A. 8-2404.

How to file in Kansas

Complete the Kansas Department of Revenue Form D-20 (Vehicle Dealer Bond) along with the dealer license application. Submit the bond form, application, fees, proof of established place of business, photos, and zoning compliance to the Dealer Licensing Bureau at the Kansas Department of Revenue. The bond must be issued by a surety authorized to do business in Kansas. The Director of Vehicles reviews and approves the bond form and amount before issuing the license; the bond must remain in effect throughout the license term.

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FAQ

Common questions

Is a motor vehicle dealer bond required in Kansas?

Yes. Kansas requires motor vehicle dealer bonds issued by an admitted surety. The required amount is $30,000 to $50,000.

How much is the bond in Kansas?

The bond amount is $30,000 to $50,000. Your annual premium is a small percentage of that, based on credit and experience.

Who requires the bond?

The bond is required by the Kansas Department of Revenue, Division of Vehicles - Dealer Licensing Bureau.

How is the bond filed?

Complete the Kansas Department of Revenue Form D-20 (Vehicle Dealer Bond) along with the dealer license application. Submit the bond form, application, fees, proof of established place of business, photos, and zoning compliance to the Dealer Licensing Bureau at the Kansas Department of Revenue. The bond must be issued by a surety authorized to do business in Kansas. The Director of Vehicles reviews and approves the bond form and amount before issuing the license; the bond must remain in effect throughout the license term.

What does the bond cover?

Surety bonds protect the obligee, not the principal. If you fail to meet the obligation the bond guarantees, the surety pays the claim and recovers from you.

Is a surety bond the same as insurance?

No. Insurance protects you. A surety bond protects whoever required the bond. You repay the surety for any claim they pay.