Nevada Auto Dealer Bond

A Nevada auto dealer bond, officially filed as a Vehicle Industry Business License Bond (OBL-210), is a surety bond required by the Nevada Department of Motor Vehicles Occupational and Business Licensing section before a qualifying vehicle industry license can be issued.

It is a financial guarantee that your dealership or vehicle business will follow Nevada law and deal honestly with customers. If you fail to do so, a harmed consumer can make a claim against your bond to recover losses.

Unlike insurance, which protects you, a surety bond primarily protects your customers and the state. If a valid claim is paid out, you are responsible for reimbursing the surety company.

Every surety is a contract between 3 parties:

• The Obligee: Nevada Department of Motor Vehicles - The state authority that requires the bond as a condition of licensing. They set the bond amount and filing rules.
• The Principal: You, the dealer or vehicle business - You purchase the bond and are bound by its terms. If a valid claim is paid, you must reimburse the surety.
• The Surety: such as Lance Surety Bonds - We underwrite the bond and guarantee payment to claimants up to the bond amount if you default on your obligations.

1. Submit Your Bond Application

You can apply for your bond online. Just enter some basic information about yourself and your business, and you should be able to submit your application within a matter of minutes. If you have any questions, we are more than happy to assist you.

2. Get a Quote

At Lance Surety Bonds, we want to provide you with the best premium rate possible. For most applicants with a strong credit history, a quote is ready quickly. More complex applications may take additional underwriting time.

3. Purchase Your Bond

Once you receive your quote, you can pay the bond premium and you’re officially bonded in Nevada. You’ll receive an email copy of the bond, and you can request a paper copy if the DMV needs the original signed form.

4. File your bond with the Nevada DMV

Submit your Vehicle Industry Business License Bond (OBL-210) as part of your dealer license application to the Nevada Department of Motor Vehicles Occupational and Business Licensing section. The DMV bond form states that original signatures are required and that electronic signatures, photocopies, or alterations may not be accepted.

Filing address:

Nevada Department of Motor Vehicles
Occupational and Business Licensing
555 Wright WayCarson City, NV 89711

The Nevada DMV requires the following vehicle industry businesses to file a surety bond or approved deposit before receiving a license.

• Standard vehicle dealers - New, used and most other vehicle dealers need a $100,000 bond unless they fall into a lower vehicle category
• Vehicle brokers - Nevada brokers must file a $100,000 OBL-210 bond or an approved deposit in lieu of bond.
• Motorcycle dealers - Dealers that sell motorcycles fall under the $50,000 bond tier.
• Horse trailer and large utility trailer dealers - Horse trailers without living quarters and utility trailers with an unladen weight of 3,501 lbs or more require a $50,000 bond.
• Small utility or boat trailer dealers - Utility trailers with an unladen weight of 3,500 lbs or less and boat trailers require a $10,000 bond.
• Manufacturers, distributors, rebuilders, and lessors - These vehicle industry license types use the same Nevada DMV bond form, with the bond amount based on the business activity and vehicle category.
• Off-highway vehicle dealers - OHV dealers generally need a $50,000 bond or an eligible rider if an existing motor vehicle dealer bond already meets Nevada’s bonding requirement.
• Peer-to-peer car sharing programs - These programs file a $100,000 bond and may also file a $100,000 bond in place of the standard insurance requirement. 
• Salespersons - Nevada requires salespersons to obtain an occupational salesperson license, but the DMV salesperson packet does not list a separate salesperson surety bond. Salespersons must be tied to a licensed and bonded dealer, lessor, or rebuilder.

The bond protects consumers from financial loss caused by dealer fraud, fraudulent representation, breach of a consumer contract, deceptive trade practices, or violations of Nevada vehicle industry law. A claim can be filed for issues such as:

• Selling a vehicle with no title, a defective title, or failing to transfer title properly
• Misrepresenting a vehicle's condition, history, mileage, or ownership status
• Retaining customer deposits without delivering the vehicle or service promised
• Failing to follow the Nevada dealer, broker, rebuilder, manufacturer, or lessor requirements
• Any consumer loss covered by the Nevada vehicle industry bond form or applicable Nevada law

A consumer's recovery is not limited to the purchase price. Nevada law allows a claimant to recover actual, consequential, incidental, and statutory damages, damages for noneconomic loss, and attorney's fees and costs from the bond.

The maximum payout per bond is the bond's penal sum: $10,000, $50,000, or $100,000, depending on your required bond amount. The bond's total aggregate liability is capped at that amount, and after any payout you, as the principal, are liable to reimburse the surety.

How the Claims Process Works?

• Consumer or claimant contacts the surety company or seeks relief through the proper DMV/legal process
• The surety investigates the claim to determine its validity
• If the claim is valid, the surety pays the claimant up to the bond's penal sum
• The dealer or vehicle business is then required to reimburse the surety for any amounts paid out
• Claims on your record can significantly increase your bond premium and may affect future bond reduction eligibility

Nevada vehicle industry business license bonds are issued on a continuous basis, meaning the original bond remains active as long as the premium is paid and the bond is not canceled. Your DMV business license, by contrast, is renewed on its own annual cycle.

Lance Surety will contact you well in advance of your renewal date to help prevent any lapse in coverage. The Nevada DMV business license packet lists a $50 renewal fee and a $25 late fee when a license expires for failure to renew.

If the surety cancels the bond, it must send written notice by registered mail to the Nevada DMV. Cancellation becomes effective 30 days after the DMV's Occupational and Business Licensing section receives that notice.

Nevada also provides a Bond Reduction Request (OBL-248) for eligible businesses. The current principals must have continuously owned the business for the preceding five years or longer, and the business must not have had administrative action taken by the Department during that period. State law caps the reduction at 50 percent, so a $100,000 dealer bond can be reduced to no less than $50,000. The DMV also reviews whether you have had any derogatory action, any lapse in bond coverage, or any pending action against the license in the past five years, and a yes to any of those can result in denial.

At renewal, the surety company will review your credit and claims history. Maintaining a strong credit profile and clean compliance record can help keep your premium costs low.

Getting a Nevada auto dealer license is a detailed process. The Nevada DMV Occupational and Business Licensing section outlines the documents and requirements applicants must submit before a license is issued.

You can find the full checklist in the Dealer, Distributor, Lessor, Manufacturer, and Rebuilder Information sheet (OBL-243) and the Business License Application Packet (OBL-335) on the Nevada DMV website.

The core requirements include the business license application, personal history questionnaires, fingerprints, DPS fingerprint waivers, the surety bond or deposit, insurance certificate, city or county business license, FEIN, business email address, established place of business, sign, location photos, and a DMV site inspection. New vehicle dealers also need dealer franchise certification.

For more information on how to get the license, check our guide: Nevada dealer license

How long does it take to get a Nevada dealer bond?

For most applicants, bonds can be issued the same day after the application and premium payment are complete. You can receive an email copy for your records, and you should request a paper original if the Nevada DMV needs the original signed bond form for filing.

What is the difference between the bond amount and the bond premium?

The bond amount, also called the penal sum, is the maximum protection available to consumers. In Nevada, the amount may be $10,000, $50,000 or $100,000 depending on your vehicle type or business activity. This is not what you pay. Your bond premium is the annual cost to purchase the bond, which is a percentage of the bond amount.

What happens if my bond lapses?

If your bond lapses, your dealership is no longer properly bonded and may fall out of compliance with Nevada DMV licensing requirements. A lapse can also hurt your renewal position and may affect eligibility for a future bond reduction request.

Can my bond be canceled?

Yes. A Nevada vehicle industry bond can be canceled by the surety. The bond form states that cancellation becomes effective 30 days after the Nevada Department of Motor Vehicles receives written notice from the surety.

Do I need a bond for every salesperson I employ?

No separate Nevada salesperson surety bond is listed in the DMV salesperson licensing packet. Salespersons need an occupational salesperson license and must be tied to a licensed and bonded dealer, lessor, or rebuilder. Your dealer bond already covers the acts of your salespersons committed within the scope of their employment.

Do I need a separate bond for each dealership location?

Usually not. Nevada law allows the DMV to accept a single bond covering one vehicle category as sufficient coverage for all of your other categories at your principal place of business and at any branch location in the same county as that principal location. Branches outside that county, and certain additional license activities, can trigger a separate bond. If you operate in more than one county or hold more than one license type, confirm your coverage with the DMV or your surety agent before filing.