What does a notary public do?
A notary is an appointed position by the Secretary of State’s department in a given state. As with many public officials, the State requires that the person obtain a surety bond prior to getting their appointment. This bond “makes sure” that when the notary violates the public trust through neglect of their responsibilities, finances are set aside to indemnify the State for its loss.
The primary responsibility of notary publics is to confirm that the individual parties to an agreement are who they claim to be. The State may suffer a loss if the notary public neglects to properly ensure the identity of the parties.
As a public official, the notary violates the public trust by failing in their duty to confirm identity. If a New Mexico notary public doesn’t confirm identity and a loss occurs, an injured party can file a claim against that State for its loss, because the State was negligent through its appointed representative.
A notary bond is a guarantee of payment to the obligee (the State) when losses occur for a penalty amount of the bond. Notary bonds are generally provided by a surety company (typically an insurance carrier). The bond usually runs concurrently with the term of a notary’s commission.
You may be familiar with a homeowners insurance policy. When a person has a rental property in Indiana claim, the insurance company pays the claim and writes off the loss. You aren’t required to reimburse the carrier for the claim. Unlike a home insurance policy however, a notary bond is simply a guarantee that the finances will be available should losses 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 surety 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 Public Errors and Omissions and can also be obtained for a nominal fee from insurance companies.
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