Obtaining a Freight Broker License in Georgia

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Learn how to become licensed as a freight broker, and speak with an Single Source Insurance agent today about purchasing the BMC-84 bond you�ll need to operate as a freight broker.

Who Needs a Freight Broker License?

All freight brokers are registered at the federal level and receive an operating authority (the equivalent of a license) from the Federal Motor Carrier Safety Administration (FMCSA). Learn more about what freight brokers do and what it takes to become one.

What Are the Steps in the Licensing Process?

In preparation for applying for a freight broker operating authority:

  1. If you will be launching your own brokerage firm, you�ll first need to establish a legal business entity and register it with the Georgia Secretary of State, the IRS, and the Georgia Department of Revenue.
  2. Decide whether you will apply for an operating authority as a �Broker of Household Goods,� as a �Broker of Property (except Household Goods),� or as both.
  3. Designate a process agent in every state where you will have an office or write contracts. Many freight brokers choose a blanket process agent company that can provide representation in every state. List all of the process agents you have chosen on a single Form BOC-3�(Designation of Process Agents)for submission to FMCSA. (A blanket process agent company can complete the form and file it on your behalf.)
  4. Purchase a $75,000 freight broker bond (Form BMC-84) or set up a Trust Fund Agreement (Form BMC-85). Most freight brokers choose the bonding option because it doesn�t require tying up $75,000 in cash.

When you have completed the above steps, set up an account on the Unified Registration System (URS) and complete the online application. After you have paid the $300 registration fee, the system will automatically give you your MC number (MCN), which is the proof of your operating authority. Within 10 business days, you should get your operating authority documents in the mail.

Why Is a Freight Broker Surety Bond Required?

A BMC-84 surety bond is a freight broker�s pledge to do business in accordance with FMCSA regulations and to pay all valid claims resulting from their noncompliance. The bond provides financial protection for FMCSA (the �obligee�) as well as for shippers and carriers doing business with the freight broker (the bond�s �principal�).

How Are Freight Broker Bond Claims Paid?

There is a third party to a BMC-84 bond in addition to the obligee and the principal�the �surety� that is guaranteeing the bond. While it�s the principal who is legally obligated to pay all valid claims against the bond, the surety actually pays a claim initially and is then reimbursed by the principal. Not repaying the surety can end up in the surety taking legal action against the principal to recover the claim amount.

What Are the Costs Involved in Obtaining a Freight Broker License?

A BMC-84 surety bond can be purchased for an annual premium that is only a small percentage of the $75,000 bond amount. That percentage, the premium rate, is set by the surety through an underwriting process that assesses the risk the surety will be assuming in paying claims on the principal�s behalf.� That risk is measured primarily on the basis of the principal�s personal credit score.

Most applicants with good credit, which signals a low risk level, will pay a premium rate in the vicinity of 2% to 4%. Those with lesser credit present a higher risk and will pay a higher premium rate.

Our surety bond professionals will get you the freight broker (BMC-84) bond you need at a competitive rate.

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