What is a Notary Public?
A notary public is an official appointed position by the Secretary of State’s department in a given state. As with many public officials, the State specifies that the person get a surety bond before receiving the appointment. This bond “makes sure” that if the official violates the public trust through negligence of their responsibilities, funds are set aside to reimburse the State for its loss.
The principal responsibility of notary publics 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 neglects to properly validate the identity of the parties.
As a public official, the notary violates the public trust by failing in their responsibility to confirm identity. If a California 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 promise to pay to the obligee (the State) if 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 the notary’s commission.
You’re probably familiar with a property insurance policy. When you have a rental property in Indiana loss, the insurance company pays the claim and writes off the loss. You aren’t required to reimburse the company for the loss. Unlike a home insurance policy however, a notary bond is simply a promise that the finances will be available if losses occur. The surety (insurance company) pays the State up to the penalty amount of the bond. However, this loss paid by the carrier is not simply written off. The carrier 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 carriers.