Motor Vehicle Dealer Bond in Wisconsin

What this bond requires in Wisconsin

Per Wis. Stat. 218.0114(7), a motor vehicle dealer must provide and maintain a bond or irrevocable letter of credit of not less than $50,000 ($5,000 if selling only motorcycles). The bond is executed in the name of the Wisconsin Department of Transportation for the benefit of any person who sustains a loss because of an act of the dealer that constitutes grounds for license suspension or revocation. WisDOT may require an additional bond up to $100,000 where it doubts financial responsibility. The bond may be terminated by the surety on 60 days written notice.

Who requires it

The motor vehicle dealer bond is required by the Wisconsin Department of Transportation, Division of Motor Vehicles, Dealer Section under Wis. Stat. 218.0114(7).

How to file in Wisconsin

Applicants file the Wisconsin Dealer Bond (Form MV2511) issued by a bonding company licensed in Wisconsin with the WisDOT Dealer Section in Madison as part of the dealer license application. The bond must run to the Wisconsin Department of Transportation in the penal sum of $50,000 (or $5,000 for motorcycle-only). If marked continuous, the bond does not expire with the license but continues year to year.

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FAQ

Common questions

Is a motor vehicle dealer bond required in Wisconsin?

Yes. Wisconsin requires motor vehicle dealer bonds issued by an admitted surety. The required amount is $50,000 to $100,000.

How much is the bond in Wisconsin?

The bond amount is $50,000 to $100,000. Your annual premium is a small percentage of that, based on credit and experience.

Who requires the bond?

The bond is required by the Wisconsin Department of Transportation, Division of Motor Vehicles, Dealer Section.

How is the bond filed?

Applicants file the Wisconsin Dealer Bond (Form MV2511) issued by a bonding company licensed in Wisconsin with the WisDOT Dealer Section in Madison as part of the dealer license application. The bond must run to the Wisconsin Department of Transportation in the penal sum of $50,000 (or $5,000 for motorcycle-only). If marked continuous, the bond does not expire with the license but continues year to year.

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.