A notary is an official appointed position by the Secretary of State’s office in a given state. Like most public officials, the State requires that the individual obtain a notary bond prior to getting their appointment. This bond “makes sure” that if the official violates the public trust through neglect of their duties, finances are available to indemnify the State for its loss.
The principal responsibility of notary publics 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 public fails to properly validate the identity of the parties.
As a public official, the notary public violates the public trust by failing in their duty to confirm identity. If a Wisconsin 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 notary bond is a guarantee of payment to the obligee (the State) when losses occur for a penalty amount of the bond. Notary Public bonds are usually provided by a surety company (typically an insurance carrier). The bond generally runs concurrently with the term of a notary’s commission.
You may be familiar with a property insurance policy. If you have a property insurance in Indiana loss, the insurance company pays the loss and writes off the loss. You aren’t required to reimburse the carrier for the claim. Unlike a homeowners insurance policy however, a notary bond is simply a guarantee 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 surety is not simply written off. The carrier will most likely seek reimbursement from the bonded party, 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 E & O and can also be purchased for a nominal fee from insurance carriers.
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