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    A BMC-84 is a financial instrument, also known as a surety bond, required by the Federal Motor Carrier Safety Administration (FMCSA) to ensure carriers can meet their financial responsibilities in the freight transportation industry

    What is a BMC-84 Used For?

    1. Financial Protection for Shippers and Carriers: The BMC-84 ensures that motor carriers have the financial capacity to cover potential liabilities arising from their operations in the freight transportation industry.

    2. Protection for Shippers: It provides a level of protection for shippers by guaranteeing that carriers can fulfill their obligations, such as delivering goods and paying for any damages that may occur during transit.

    3. Compliance with FMCSA Regulations: The Federal Motor Carrier Safety Administration (FMCSA) mandates the use of BMC-84 to ensure carriers comply with regulations and maintain financial responsibility for their services.

    4. Risk Management: The bond acts as a form of insurance, mitigating financial risks associated with carrier operations, and helps maintain the stability of the transportation industry.

    How Much does a BMC-84 Surety Bond Cost?

    The cost of a BMC-84 surety bond can vary based on several factors. The BMC-84 is not a traditional surety bond but rather a trust fund agreement, and its cost structure can be different from standard surety bonds. Here are some key points to consider:

    1. Coverage Amount: The higher the coverage amount required, the greater the cost. The coverage amount is essentially the maximum amount the bond will pay out in case the carrier fails to meet its financial responsibilities.

    2. Carrier's Financial Stability: The financial health and stability of the carrier play a crucial role. Carriers with a strong financial history and positive credit are often eligible for lower bond premiums.

    3. Experience and Safety Record: Carriers with a good safety record and a history of compliance with regulations may be viewed more favorably by surety providers, potentially leading to lower bond costs.

    4. Type of Freight: The nature of the freight being transported can impact the bond cost. Certain types of cargo may pose higher risks, influencing the bond premium.

    5. Underwriting Criteria: Each surety provider may have different underwriting criteria. Factors such as the carrier's business plan, industry experience, and operational practices can affect the bond cost.

    What Is Right for Me: BMC-85 Vs. BMC-84?

    Determining whether a BMC-84 or BMC-85 surety bond is right for someone depends on their specific financial situation and preferences. The BMC-84 is a bond that involves a third-party surety company and is suitable for carriers seeking a traditional bond. On the other hand, the BMC-85 is a self-insurance option, allowing carriers to demonstrate financial responsibility without relying on an external surety, which can be a preferable choice for financially stable and well-established companies. To make an informed decision, consider factors such as financial stability, risk tolerance, and compliance preferences. We can break it down even further:

    Nature of the Bond

      • BMC-84:

        A BMC-84 bond is a traditional surety bond involving a third-party surety company to ensure carriers' financial responsibility.
      • BMC-85:

        A BMC-85 bond is a self-insurance option allowing carriers to demonstrate financial responsibility without relying on an external surety. How would you like to proceed in incorporating this information into your web page content?

    Financial Considerations

      • BMC-84:

        BMC-84 bond involve premium payments to a third-party surety company based on factors like coverage amount, credit history, and the carrier's financial stability.
      • BMC-85:

         BMC-85 bond requires carriers to set aside their own financial reserves, eliminating premium payments but necessitating sufficient financial strength for potential claims.

    Credit and Financial Health

      • BMC-84:

        For a BMC-84 bond, a carrier's credit and financial health significantly impact the bond premium, with stronger credit and financial stability often leading to lower premium costs
      • BMC-85:

        The carrier's ability to self-insure relies directly on its financial strength, requiring a robust financial standing to cover potential claims without external surety support.

    Risk Tolerance

      • BMC-84:

        A BMC-84 bond involves carriers accepting the financial risk associated with premium payments
      • BMC-85:

        BMC-85 bonds require carriers to have a higher risk tolerance, as they are self-insuring and responsible for covering potential claims without the safety net of an external surety.

    Frequently Asked Questions

    1Are Claims Processed In-House?
    Yes, PFA Transportation Insurance & Surety Services is a licensed claims adjuster for financial institutions authorized by the Federal Motor Carrier Safety Administration (FMCSA). We specialize in claims processing of BMC-84 Surety Bonds and BMC-85 Trust Agreements. We have represented commercial banks and financial institutions since 1995 and currently handle more than 15,000 claims per year. We are experts at what we do! Our dedicated staff is here to assist in expediting the claims process and can effectively act as a middleman between the claimant and the broker.
    2What Is The Process For a Claim to be Filed Against a Broker?
    Claimants (carriers, shippers, and/or authorized third parties) first need to provide some basic information: the MC # of the broker, your carrier’s MC # and contact information (including email and phone number), the date(s) the load(s) picked up and the total dollar amount owed. This can be accomplished by going to our website at PFAprotects.com, scrolling down to the bottom of the main page and clicking on the big green bar that states “Submit a BMC-84 or BMC-85 Claim Here”. Upon the initial submission online, an email with a status update will be sent to the email address provided. Should your load(s) qualify, the email will contain login information to our claimant portal where you must provide additional load details as well as upload the required supporting documentation: rate confirmation, bill of lading, and carrier’s invoice for each load you wish to submit. Upon completion of the process, our claims staff will verify the information provided. We work directly with our active brokers to get valid claims paid quickly. In 95% of the claim inquiries, the broker pays the claimant after being informed a claim has been filed against their surety. If pending claims total more than the $75,000 surety instrument, or if the broker stops communicating with us, or if the broker stops providing timely payments to the claimant, we will recommend the Surety issue a “Notice of Cancellation”. The FMCSA allows brokers to operate for an additional 30 days after the filing of a Notice of Cancellation. We must accept claims against a cancelled broker’s surety instrument for 60 days after their effective cancellation date with the FMCSA. If a broker is not reinstated and their claims continue to multiply, we will not be able to determine the amount each claimant will receive until after the application period has expired. Payouts are conducted in one of two ways: Full claim payout – claims did not exceed the surety instrument and all valid claims are paid in full. Pro rata payout – each valid claimant is paid a pro-rata percentage of what they are owed.
    3What is the Difference Between a Bond and a Trust Agreement?
    The FMCSA requires a $75,000 surety instrument be filed for a transportation broker’s license. Both the BMC-84 (“bond”) and the BMC-85 (“trust agreement”) fulfill this requirement. The basic difference between the two is that a BMC-84 is issued by an insurance company while a BMC-85 is issued by a financial institution. An insurance adjuster may see thousands of claims per year, but only a handful of those claims will involve a BMC-84. The claims adjuster’s lack of experience in BMC-84 and BMC-85 claims, total volume of other claims, and lack of accountability to the policy holder because of their discretion over the corpus of the bond inevitably leads to claims being paid too quickly and to the detriment of both the broker and other valid claimants. At PFA Transportation Insurance & Surety Services, we only handle claims against BMC-84 and BMC-85 surety instruments. We faithfully uphold our fiduciary obligation to investigate all submitted claims. Proper investigation and adherence to the principles of good faith and fair dealing help prevent fraudulent claims getting paid and monies remain available to pay valid claims.
    4Does Pursuing a Claim Against a BMC-84 or BMC-85 Surety Instrument Mean Forgoing Other Avenues of Recovery?
    If the amount of claims received exceeds the $75,000 surety instrument, it is not possible for a Surety to fully compensate all valid claimants. Claimants often seek multiple options for recovery. We ask that claimants contact us if they receive payment from another source so that we can record any full or partial payments against the total amount due on a claim. In some instances, carriers unable to collect the full amount of freight charges from the surety instrument can proceed collaterally against the underlying shipper or consignee. You should contact legal counsel in your State to determine if that option is available in your circumstances.

    What You Need. When You Need It.

    BMC-84 / BMC-85

    (Required for Freight Broker Authority)

    We have several pricing and payment options for BMC-84 Surety Bonds and BMC-85 Trust Agreements since 1998. We keep track of every claim from start to finish by constantly processing the required paperwork and communication until it is closed.


    Get the right coverage and secure the most competitive rates. When it comes to protecting your business, few insurers offer all of the different lines of insurance that a domestic freight broker and/or freight forwarder needs. We are here to offer you intelligent insurance solutions on every front.



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