California Business Partner Automation Bond

For any business that processes or issues vehicle-related documents on behalf of others, the California DMV requires them to register through the California business partner automation program. As part of that process, businesses are required to obtain a California business partner automation bond. These bonds help ensure ethical and professional conduct when it comes to vehicle-related document processing. First-line business partners are required to purchase a $650,000 business partner automation bond, while second-line partners are required to get a $1,000,000 business partner automation bond. The price for these bonds will vary depending on the specific business, but rates begin at 1% of the total bonded amount. For example, the price of a $650,000 business partner automation bond starts at $6,500.

Sample Payment and Performance Bond Form
Sample CA Business Partner Automation Bond
CA Business Partner Automation Bond

Bond Amount: $650,000 for first line partners, $1,000,000 for second line partners

Required By: California Department of Motor Vehicles

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Cost of Business Partner Automation Bond

The cost of a business partner automation bond will differ for each business depending on a variety of factors, such as your experience in the industry, your credit score, and the insurance company that is providing the bond. Out of these factors, your credit score has the largest impact on the total cost of your bond. If you have a high credit score, we can get a lower price for your bond. Rates for a business partner automation bond start at 1% of the total bonded amount, so for a $650,000 bond, that’d be $6,500, and for a $1,000,000 bond, that’d be $10,000. 

Additionally, one way to lower the annual cost of your bond is by purchasing a multi-year bond. Typically, we can offer at least a 15% annual discount when a bond is purchased for over one year. We’re partnered with over 10 insurance companies, allowing us to offer the most competitive pricing on the market. Please let us know if you find a better price, and we’ll do our best to beat it!

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What is the Business Partner Automation Program?

The business partner automation program is an initiative that enables the Department of Motor Vehicles to establish contracts with eligible industry partners who conduct vehicle registration and titling transactions remotely. Through the business partner automation program, businesses can efficiently handle various DMV tasks, such as issuing and processing new vehicle registrations, registration renewals, replacement titles, and other related functions. The program offers numerous benefits, including significant time savings for businesses and their customers, eliminating the need for in-person DMV visits or customers reaching out for registration-related inquiries. This streamlined approach leads to an enhanced customer experience and potentially increased business revenue due to the time saved in handling these transactions.

What are the different kinds of partners and the bonds they need?

There are 3 types of businesses within the California business partner automation program: first-line business partners, first-line service providers, and second-line business partners. Each of these businesses serves a unique purpose and has different requirements. 

First-Line Business Partner

First-line business partners are responsible for receiving data directly from the Department of Motor Vehicles to streamline the registration and titling of vehicles for their specific business purposes. This role is exclusive to their own internal needs and operations. To qualify for this role, first-line business partners must meet a stringent requirement, maintaining a business partner automation bond of $650,000, ensuring their commitment to responsibly handling DMV data and processes. 

First-Line Service Provider

First-line service providers are crucial in the intricate business partner automation program. Their primary responsibility is connecting the motor vehicle department with second-line business partners. They transfer information from the DMV to various second-level business partners within the ecosystem. To become a first-line service provider, they must maintain a business partner automation bond of $1,000,000.

Second-Line Business Partner

Second-line business partners are the most common type of partners and include diverse entities, ranging from new and used car dealers to dismantlers, leasing companies, and rental companies. While new car dealers must participate in the business partner automation program, used car dealers can choose whether to join or not. Since these businesses are already bonded for their specific license, no additional bond is required to join the business partner automation program. To facilitate the processing of vehicle sales and uphold the efficient flow of information and data, second-line business partners must establish a partnership with a first-line service provider before applying to join.

How can someone join the Business Partner Automation program?

For First-Line Business Partners and First-Line Service Providers:

  1. Establish a contract and communication link with the Department of Motor Vehicles.
  2. Develop necessary programs, training, and a database for vehicle transactions.
  3. Complete the required applications, agreements, and statements.
  4. Secure a business partner automation bond of either $650,000 or $1,000,000.
  5. Pay a $305 application fee and, if applicable, an additional $232 fee for any extra branch locations
  6. Submit your completed application, along with the requested documents and fees, to the Department of Motor Vehicles. You can find their mailing address on the CA DMV website linked below.

For Second-Line Business Partners:

  1. Establish a contract with a first-line service provider.
  2. Maintain the required occupational license(s), such as an auto dealer license, dismantler license, etc.
  3. Complete the application and screening process.
  4. Pay a $305 application fee and, if applicable, an additional $232 fee for any extra branch locations
  5. Submit all necessary documents and fees to your designated first-line service provider.

We recommend checking out the CA DMV website for more information about the necessary documents and applications and an in-depth look at the application process. 

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