Surety Bond

M

MADBOOKER

Active Member
Apr 3, 2009
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Hello All.

Can anyone recommend a good company that specializes in Surety bonds for Canadian transportation brokers.

I've noticed an extreme increase this year. just looking at different options.

Thanks.
 
We use The Guarantee Company Of North America, 954 Dundas St. Woodstock, ON 519 539 9868. The bond is obtained through our insurance broker, so I am not sure if you can go direct to this underwriter or not. The premium for us last year runs around $3000.00 for the 75k bond. I wouldn't be surprised if the rates have or will be going up this year. If you find someone who offers the bond at a significantly lower rate, please let us all know. As a broker, you know we're always looking for the "lowest rate"!
 
Agreed Mike Jr. We use Marsh Canada for all of our other insurance needs, contingency cargo, general liability, errors and omissions, etc. Very knowledgeable and great to deal with.
 
Thanks guys for sharing.
I'm at Approx 2400.00 per year for 75000. which is up about 300.00 from last year.
If interested in seeing if you can save some $$

C.U.T.C Inc.
1295 Carol CR.
Laval
866-927-8294 or 450-687-8294

Let me know how it works out.
Danny
 
We use CG & B for our error and omissions/ contingent cargo policy as well they get us our surety for $ 3000 USD. never had any issues with them ( been with them for 10 yrs now - based out of markham, ON )
 
$75,000 Freight bond is currently being offered at $3000 US.

There may be another option in the new year for about $2700 US.
 
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Does anyone know any insurers that are willing to work with new freight brokers (> 3 years)?

The Guarantee Company Of North America has stated they are unable to insure us because we are a new company without full collateral.
 
FMCSA Surety Bond and Exempt Commodities

For those of you (carriers) that pick up freight with a BOL header reading "Exempt Commodities" what it means is that certain transportation regulations do not apply. For example, if you picked up a full load of produce from CA to Canada, and you got the load brokered to you, and the broker did not pay you, you cannot rely on the broker's surety bond to cover your unpaid freight charges.
Attached is a list of exempt and non-exempt commodities.
 

Attachments

That's a big list and this bond doesn't cover any shipments to Canada anyways. It is getting very restrictive for carriers to claim against these brokers.
 
Ins-Broker said:
That's a big list and this bond doesn't cover any shipments to Canada anyways. It is getting very restrictive for carriers to claim against these brokers.
Click to expand...
It doesn't cover intra-Canada shipments (for obvious reasons), but certainly applies to cross-border non-exempt commodities.
 
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The bond does cover shipments to and from Canada. It doesn’t cover exempt commodities or intrastate freight. Any nonexempt freight that is inter-jurisdictional and picks up and/or delivers in the US is covered.
 
Years ago, I had a problem with Pacific Financial over shipments going from Canada to the US, where based on an old ICC ruling that required shipments entering the US to have a new BOL created at time of entry - geared to marine imports, interpreted that as applying to shipments entering the US from Canada. No one ever completes a "new" BOL at port of entry, so it was an easy way to decline the claim on the bond.
 
Freight Broker said:
The bond does cover shipments to and from Canada. It doesn’t cover exempt commodities or intrastate freight. Any nonexempt freight that is inter-jurisdictional and picks up and/or delivers in the US is covered.
Click to expand...
and a whole 75k ( or two decent used dry vans) I sure feel protected from scammers with 75 whole thousand to protect carriers. Oh wait my pickup cost more. Most useless provision besides the trust acct in transportation.
 
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Not saying the bond is perfect..but it’s something at least. What do we get when a shipper doesn’t pay? Nothing. They aren’t required to have a bond. And I’m not sure how well a bond protects against scammers anyway. I’m guessing not much..
 
Speaking of trust accounts, how many carriers receive payments from Brokers trust accounts?
Should it come directly from a trust account, or should the carrier portion be transferred to a chequing account and the Brokers portion be transferred to their operating account?
Not an accountant by any means, but it would be interesting to see how many brokers have an actual trust account and also if it's being used correctly...

Keep well,
Mike
 
MikeJr said:
Speaking of trust accounts, how many carriers receive payments from Brokers trust accounts?
Should it come directly from a trust account, or should the carrier portion be transferred to a chequing account and the Brokers portion be transferred to their operating account?
Not an accountant by any means, but it would be interesting to see how many brokers have an actual trust account and also if it's being used correctly...

Keep well,
Mike
Click to expand...
We maintain a trust account and pay our carriers directly from that account. We don’t take that extra step of separating the carrier portion from our profit. It just adds an extra layer of accounting hassle we don’t feel is necessary. If, after 35 years, we suddenly decided to close up shop and run off to Bali, the first thing I would do is empty the trust account to a zero balance. Hmmm……Bali….sounds nice.
 
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