Notaries are public officials
A notary public is an official appointed position by the Secretary of State’s department in a given state. Just like most public officials, the State requires that the individual get a notary bond before receiving the commission. This bond “makes sure” that if the notary violates the public trust through neglect of their duties, funds are available to indemnify the State for its loss.
The main responsibility of notaries public is to validate 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 Florida notary public doesn’t confirm identity and a loss occurs, an injured party can file a claim against that State for the loss, because the State was negligent through its appointed representative.
A notary bond is a guarantee of payment to the obligee (the State) if losses occur for a penalty amount of the bond. Surety bonds are usually provided by a surety company (typically an insurance carrier). The bond often runs concurrently with the period of a notary’s commission.
You’re probably familiar with a home insurance policy. If a person has an Indiana home insurance claim, the insurance carrier pays the loss and writes off the loss. You aren’t required to reimburse the company for the damages. Unlike a homeowners insurance policy however, a notary bond is simply a guarantee that the finances will be available if losses occur. The surety (insurance company) makes a payment to the State up to the penalty amount of the bond. However, this loss paid by the carrier is not simply written off. The company 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 Errors and Omissions and can also be obtained for a nominal fee from insurance carriers.