BMC 84 (ICC Bonds)

How does a BMC-84 bond work?

The BMC-84 is a license bond required by the FMCSA under 49 U.S. Code § 13906. It involves three parties: you (the freight broker), the FMCSA (the obligee), and the surety company that issues the bond.

If a carrier or shipper files a claim for fraud, non-payment, late payment, or other contractual breaches, the surety investigates. If the claim is valid, the surety reimburses the claimant for losses and damages up to $75,000. You are then financially liable to repay the surety for the full amount paid.

Requirements for the bond

Because freight brokerages are considered higher risk, sureties typically request your financial statements (tax returns, profit and loss statements) to assess your business's financial health. You may also need to sign an indemnity agreement acknowledging financial liability for any valid claim.

The bond is only one step in the freight broker licensing process—you must also secure public liability insurance, cargo insurance, and other requirements within 90 days after the FMCSA publishes its notice of intention to register your brokerage.

BMC-84 bond vs. BMC-85 trust fund

Instead of a surety bond, you may open a trust fund by filing Form BMC-85. With a trust fund, you deposit the full $75,000 in a trust account. The BMC-84 bond lets you leverage the bond amount without owning it, paying a percentage premium each year instead. The bond is generally ideal for newer freight brokers who lack the capital of larger enterprises, while the trust fund suits bigger brokers who can afford the upfront cost.

Applying for the bond

First, register your freight brokerage with the FMCSA to receive a docket number. Then apply online with your business information and docket number. You'll receive a quote, and if approved, the surety typically files the bond electronically on your behalf. Terms last one year and must be renewed annually to maintain your license.