A notary public is an official appointed position by the Secretary of State’s department in any state. As with most public officials, the State specifies that the person obtain a surety or notary bond before receiving their commission. This bond “makes sure” that when the official violates the public good through neglect of their responsibilities, funds are available to reimburse the State for its loss.
The main duty of notaries is to validate that the individual parties to a contract are who they say they are. The State can suffer a loss if the notary fails to correctly ensure the identity of both parties.
As a public official, the notary public harms the public trust by failing in their responsibility to validate identity. If a South Carolina notary public doesn’t confirm identity and a loss occurs, an injured party may file a claim against that State for its loss, because the State was negligent through its appointed notary.
A notary bond is a promise to pay to the obligee (the State) when losses occur for the penalty amount of the bond. Notary bonds are generally issued by a surety company (typically an insurance company). The bond generally runs concurrently with the term of the notary’s commission.
You may be familiar with a truck insurance policy. If a person has an auto insurance Indiana loss, the insurance company pays the loss and writes off the loss. You aren’t forced to pay back the carrier for the loss. Unlike a car insurance policy however, a notary bond is simply a promise that the funds will be available when a loss occur. The surety (insurance company) pays the State up to the penalty amount of the bond. However, this claim paid by the carrier is not simply written off. The company will most likely seek reimbursement from the bonded person, the notary themself.
A notary bond protects the public. Who protects the notary? Insurance coverage is available to provide this protection – it’s called Notary Errors and Omissions and can also be obtained for a nominal fee from insurance companies.
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