Florida law requires all motor vehicle dealers to post a $25,000 surety bond or irrevocable letter of credit as part of the dealer licensing process. This bond is filed with the Florida Department of Highway Safety and Motor Vehicles and guarantees that the dealer will follow all laws under Chapters 319 and 320 of the Florida Statutes.

The dealer bond protects consumers and other businesses from losses caused by a dealer’s failure to comply with state regulations—such as title fraud, misrepresentation, or contract violations. If a valid claim is made, the surety company compensates the affected party up to the bond amount, and the dealer must reimburse the surety.

This requirement applies to all independent, wholesale, and franchise motor vehicle dealers in Florida. The bond must be kept active at all times to maintain your license, and it must match the legal business name and any registered DBAs.

The bond is issued for one license term and must be renewed each year. Dealers can also choose to provide an irrevocable letter of credit for the same $25,000 amount instead of a bond.

While the bond amount is $25,000, dealers only pay a small annual premium—typically one to three percent of the bond value—depending on credit and financial strength. Working with a licensed surety bond provider ensures fast approval and compliance with Florida’s requirements.

Maintaining this bond demonstrates your business’s integrity, protects your customers, and keeps your dealer license in good standing.

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