Movers transporting household goods in Florida may need a Florida Household Mover Performance Bond. Learn more about these bonds, what they guarantee, what they cost and how to easily obtain one.
The Florida Household Mover Performance Bond protects consumers from negligence, fraud, malfeasance, misfeasance, breach of contract, financial failure, misrepresentation or any other failure of the moving company to perform according to Florida Code 507.
If the Mover violates and part of the code, the Mover Performance Bond provides financial recourse to the affected party.
The Principal on the Performance Bond is the Mover. The Mover makes a guarantee to the State of Florida that it will upcode Florida Moving Code 507. The State of Florida, Department of Agricultural and Consumer Services (the Department) is the Obligee. The Surety is a third party bond company that is guaranteeing that the Mover upholds the Code.
If the Mover violates the code, a claim can be brought against the bond and the Surety and the Surety may be responsible for paying damages up to the bond amount.
The State of Florida allows Movers with two vehicles or less to provide a Florida Household Mover Bond in lieu of the insurance requirements for larger movers.
A Florida Mover with two vehicles or fewer may also choose to provide a certificate of deposit for $25,000 and a Florida financial institution.
However, a CD will tie up cash that the Mover could be using for operations or expansion. Alternatively. Surety Bonds are considered a form of unsecured credit as UCC and license filings are not typically filed unless a claim is made. Therefore, a surety bond allows the Mover to use their cash for other purposes. You can read more about the differences between surety bonds and CDs here.
Movers with more than two vehicles need to provide liability insurance of at least $10,000 per shipment for the loss or damage of household goods resulting from the negligence of the mover or its employees or agents.
Florida Household Mover Performance Bonds are required to be $25,000.
Florida Household Mover Performance Bonds cost $125 a year for most Movers who want to purchase a bond instantly. Better pricing may be available for movers willing to submit financial statements.
Florida Household Mover Performance Bonds can be purchased instantly and without a credit check for most movers.
Any party affected by the mover's violation of code can file a bond claim with The Department.
The department must use the surety bond exclusively for the payment of claims to consumers who are injured by the fraud, misrepresentation, breach of contract, misfeasance, malfeasance, or financial failure of the mover or moving broker or by a violation of this chapter by the mover or broker.
Liability for these injuries may be determined in an administrative proceeding of the department or through a civil action in a court of competent jurisdiction.
Multiple claims can be made against the movers Performance Bond. However, the most the Surety has to pay is the bond amount, regardless of the number of claims made or the damages.
Additionally, bond liability does not stack. For example, a surety bond company that writes a bond for 5 consecutive years does not have $100,000 in liability. The same $25,000 still applies.
Indemnity is Required on Florida Household Mover Performance Bonds. This means that if the surety bond company pays a valid claim, they will seek reimbursement from the Principal and any indemnitors.
The company is always an indemnitor on the bond and the company shareholders and their spouses typically are as well. Surety Bond claims should be avoided at all costs surety bonds are not like insurance. More can be read about indemnity here.
The Surety may cancel the Mover Performance Bond at any time by giving the Department 30 days written notice by certified mail. However, the Surety Bond Company is still liable for claims that happened while the bond was active and for the 30 day cancellation period.
A Mover who has their bond canceled must replace the Performance Bond or have their license revoked.
Florida Household Mover Performance Bonds are a great alternative to insurance policies for smaller movers. These Surety bonds are inexpensive and can be purchased instantly. Contact our surety bond experts anytime for all your surety questions and needs.