A notary is an official appointed position by the Secretary of State’s department in a given state. Like many public officials, the State specifies that the individual obtain a notary bond prior to getting their appointment. This bond “makes sure” that if the notary violates the public trust through neglect of their duties, funds are set aside to reimburse the State for its loss.
The primary responsibility of a notary is to validate that the individual parties to an agreement are who they claim to be. The State may suffer a loss if the notary public fails to properly confirm 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 Maine notary public doesn’t confirm identity and a loss occurs, an injured party can file a claim against that State for their loss, because the State was negligent through its appointed representative.
A notary bond is a promise to pay to the obligee (the State) should 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 generally runs concurrently with the term of a notary’s commission.
You’re probably familiar with a home insurance policy. When a person has a rental property in Indiana loss, the insurance carrier pays the loss and writes off the loss. You aren’t required to reimburse the carrier for the damages. Unlike a property insurance policy however, a notary bond is simply a promise that the finances will be available should losses occur. The surety (insurance company) makes a payment to the State up to the penalty amount of the bond. However, this claim paid by the carrier 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 may also be purchased for a nominal fee from insurance carriers.
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