A PrePass bond is a surety bond that trucking companies must use if they enroll in the PrePass program and is a financial guarantee that all tolls and other fees will be paid according to the agreement. For many trucking companies, the PrePass program is useful because it helps save time, fuel. and reduce congestion. PrePass bonds cost as low as 1% of the required bond amount (which is set by PrePass and will consider your fleet size).
PrePass Bond Definition and Example
A PrePass bond is a bond required when signing up for PrePass, a toll-paying service that trucking companies can use to pay tolls electronically. The bond is to ensure that trucking companies will pay all of the fees and other costs when using PrePass’s toll bypass service and line of credit. If PrePass finds out that you reneged on this agreement, they can file a claim against the bond to recoup their loss.
As with most surety bonds, a surety bond is a three-party agreement. For PrePass bonds, this includes you, PrePass and the surety company.
What is an example of a PrePass Bond?
A trucking company successfully signs up for PrePass and begins using their services. However, a couple of months in PrePass discovers that you have not been paying all the toll expenses and other fees. PrePass files a claim against the bond to recoup their financial loss.
How Does a PrePass Bond Work?
PrePass is a service operated by HELP Inc., a non-profit organization that does good for trucking companies and the general public. First, their services help increase productivity because trucking companies can quickly bypass inspection facilities, leading to lower fuel and operating costs. This also reduces congestion, easing traffic and allowing inspection facilities to dedicate more resources to the real troublemakers. Another perk is a central office — unlike other tolling services where you’d need to contact each tolling authority to dispute something, all of this can be addressed in one place with PrePass.
When signing up for PrePass, trucking companies must furnish a surety bond, among other requirements. For the PrePass Plus program, you’re granted a line of credit — funds that businesses can access on an as-need basis. The bond ensures that trucking companies make good on their financial obligations, including paying the required tolls and repaying the line of credit terms according to the agreement.
When purchasing your PrePass bond, you’ll notice the surety mention three key terms:
A claim is filed when PrePass believes that you violated one of their agreements, such as failure to pay required tolls or to meet the repayment terms on the line of credit. If they supply proof, the surety will approve the claim and reimburse PrePass up to the bonded amount. The surety will financially fulfill the claim but you will still be responsible for repaying the surety.
If it’s discovered that there was a mistake with documentation that proves it, then you should not be liable for any of the claims.
Premiums on PrePass bonds can start as low as 1% of the required bond amount, with a $100 baseline charge. Generally, those with good credit will qualify for lower premiums, while low-credit applicants will be subject to higher costs.
The actual bonded amount is enforced by PrePass and will consider several factors, such as the number of transponders and estimated toll usage charges. If the minimum bond amount is $10,000 for example, then your premium can start as low as $100.
Keep in mind that bond terms typically last one year. You would need to pay another premium to renew your bond term and stay compliant with PrePass’s rules
Trucking companies can find a PrePass bond through standard insurance carriers or specialized surety bond companies. Similar to how tolls can now be paid electronically, surety bonds are now available for purchase online. Generally, the following steps will apply:
Submit an application that includes your personal and business information (e.g., business name and address).
Receive a premium quote based on your qualifications.
Purchase and receive your bond (or refuse and shop around).
Submit your bond to PrePass. Keep in mind other documents may be required with your application (e.g., motor carrier permit, insurance card, overweight permit).
Grab Your FREE Quote from Worldwide Insurance, Inc.
Obtaining a PrePass Bond is easy when applying with Worldwide Insurance, Inc. Just fill out our initial application form and get an instant quote in minutes. With rates starting as low as 1%, we issue all types of surety bonds in all 50 states. No credit check required and no obligation.
You would pay $17.65 monthly per truck to use PrePass’s weigh station bypass services. Keep in mind that other recurring charges can apply, including maintaining your surety bond.
Premiums on a PrePass bond can start at 1% of the required bond amount with a $100 baseline charge. PrePass enforces the minimum requirement and will consider the number of transponders and approximately how much your trucking company will incur in toll charges.
Terms on a bond typically last one year and you would need to pay another premium to renew your term.
Yes, bad credit applicants can still get bonded but may face higher premiums. Worldwide Insurance, Inc. works with thousands of business owners— even those with low credit — to help them meet their bonding requirements.
Visit our list of bonds by state to get a closer idea of your bonding requirements. To learn more about surety bonds in general, check out our free surety bond guide. If you’re ready to buy your bond, apply online today.