A notary public is an official appointed position by the Secretary of State’s department in a given state. Like many public officials, the State requires that the person get a surety bond before receiving the commission. This bond “makes sure” that if the notary violates the public trust through neglect of their duties, funds are set aside to indemnify the State for its loss.
The principal duty of notaries public is to ensure that the individual parties to a contract are who they claim to be. The State may suffer a loss if the notary public fails to properly ensure the identity of the parties.
As a public official, the notary violates the public trust by failing in their responsibility to confirm identity. If an Idaho notary public doesn’t confirm identity and a loss occurs, an injured party can file a claim against that State for their loss, because the State was negligent through its appointed representative.
A notary bond is a guarantee of payment to the obligee (the State) if losses occur for a penalty amount of the bond. Surety bonds are often provided by a surety company (typically an insurance carrier). The bond often runs concurrently with the term of the notary’s commission.
You’re probably familiar with a property insurance policy. When a person has an Indiana home insurance loss, the insurance company pays the claim and writes off the loss. You aren’t required to reimburse the carrier for the claim. Unlike a homeowners insurance policy however, a notary bond is simply a guarantee that the finances will be available when losses occur. The surety (insurance company) makes a payment to the State up to the penalty amount of the bond. However, this loss paid by the carrier is not simply written off. The surety will most likely seek reimbursement from the bonded party, 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 Public E & O and can also be purchased for a nominal fee from insurance carriers.
