Motor Vehicle Dealer Bond in Minnesota

What this bond requires in Minnesota

Minn. Stat. 168.27, subd. 24 requires every licensed motor vehicle dealer to keep in full force a $50,000 corporate surety bond approved by the registrar. The bond is for the benefit of the State of Minnesota and any transferor, seller, or purchaser of a motor vehicle for monetary loss caused by failure of the licensee to meet obligations. Dealers file Form PS2446 with DVS. Businesses that buy or sell more than five vehicles per 12-month period must be licensed.

Who requires it

The motor vehicle dealer bond is required by the Minnesota Department of Public Safety, Driver and Vehicle Services Division (DVS), Dealer Unit under Minn. Stat. 168.27, subd. 24.

How to file in Minnesota

Applicants file the Motor Vehicle Dealer License Surety Bond (Form PS2446) with the Minnesota Department of Public Safety along with the Dealer License Application. The bond must be in the penal sum of $50,000 (or $5,000 for the limited dealer categories), issued by a corporate surety authorized in Minnesota, and run to the State of Minnesota. The bond and license must be renewed annually.

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FAQ

Common questions

Is a motor vehicle dealer bond required in Minnesota?

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

How much is the bond in Minnesota?

The bond amount is $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 Minnesota Department of Public Safety, Driver and Vehicle Services Division (DVS), Dealer Unit.

How is the bond filed?

Applicants file the Motor Vehicle Dealer License Surety Bond (Form PS2446) with the Minnesota Department of Public Safety along with the Dealer License Application. The bond must be in the penal sum of $50,000 (or $5,000 for the limited dealer categories), issued by a corporate surety authorized in Minnesota, and run to the State of Minnesota. The bond and license must be renewed annually.

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.