5.4 Bond and Insurance
Key Takeaways
- Connecticut does NOT require a surety bond for notaries, unlike many other states
- Errors and Omissions (E&O) insurance is optional but strongly recommended
- Notaries are personally liable for damages caused by their official misconduct
- A surety bond protects the public, while E&O insurance protects the notary
- Without a bond or insurance, a notary's personal assets are exposed in a lawsuit
No Bond Required
Connecticut does not require a notary public to obtain a surety bond. This sets it apart from many states that mandate bonds ranging from $5,000 to $25,000 (for example, California requires a $15,000 bond and Texas a $10,000 bond). On the exam, the correct Connecticut answer to "What bond amount is required?" is none — a deliberate contrast with other jurisdictions.
No Insurance Required — But Strongly Recommended
Connecticut also does not require notaries to carry Errors and Omissions (E&O) insurance. The Office of the Secretary of the State nonetheless recommends it, because the absence of a bond means there is no third-party fund standing behind the notary's mistakes.
Bond vs. Insurance — Who Is Protected
This distinction is the single most-tested concept in this section. They are not the same product.
| Feature | Surety bond | E&O insurance |
|---|---|---|
| Who it protects | The public (injured party) | The notary |
| Who repays the surety | The notary must reimburse the surety | No reimbursement; insurer absorbs the loss |
| Required in CT? | No | No |
| Typical purpose | Guarantees a recovery source for victims | Covers the notary's defense and damages |
A bond is not insurance for the notary: if the surety pays a claim, the notary must pay the surety back. E&O insurance is the product that actually shields the notary's own finances.
Personal Liability
A Connecticut notary is personally liable for damages caused by their official misconduct or negligence. There is no statutory cap and no state fund to absorb the loss, so a single serious error can reach personal assets.
| Liability reality | Impact |
|---|---|
| Personal liability for misconduct | Lawsuits target the notary directly |
| No required bond or insurance | No automatic fund behind a claim |
| No statutory damage cap | Exposure can be substantial |
What E&O Insurance Covers
| Coverage | What it addresses |
|---|---|
| Negligent errors | Honest mistakes in performing an act |
| Omissions | Failing to complete a required step |
| Legal defense costs | Attorney fees even if you ultimately win |
| Settlements/judgments | Money awarded to an injured party |
Important limit: E&O insurance covers negligence and honest mistakes, not intentional fraud or willful misconduct. A notary who knowingly notarizes a forged signature cannot expect E&O coverage to bail them out.
Worked Scenario
A notary mistakenly notarizes a deed without confirming the signer's identity; the signer turns out to be an impostor and the true owner sues for the lost property value. With E&O insurance, the policy funds the legal defense and any covered settlement up to the policy limit. Without it, the notary pays defense costs and damages personally. Policies are inexpensive — commonly $25 to $100 per year for modest limits — which is why the state calls coverage prudent.
Where to Obtain Coverage
E&O policies (and bonds, if a notary chooses one voluntarily) are sold through insurance agents, notary membership organizations such as the National Notary Association (NNA) and American Society of Notaries (ASN), and online providers, in a range of coverage limits.
How Connecticut Compares to Bond States
Understanding the contrast with bond-requiring states clarifies why E&O matters so much in Connecticut. In a typical bond state, the notary buys, say, a $15,000 bond as a condition of commissioning; if the notary harms a member of the public, the injured party can claim against that bond up to its limit, and the surety then pursues the notary for repayment. The public has a guaranteed first source of recovery. Connecticut has no such guaranteed fund, so an injured party who wins a judgment must collect directly from the notary's personal assets.
That structural gap is the entire reason the Secretary of the State urges notaries to buy E&O coverage voluntarily: it is the only layer of financial protection the system offers, and the notary must arrange it themselves.
Limiting Your Exposure Beyond Insurance
Insurance is a backstop, not a substitute for careful practice. The most reliable way to control liability is to perform acts correctly so claims never arise. That means verifying the signer's identity with current, acceptable identification, confirming the signer appears willing and aware, refusing to notarize when something is wrong, completing certificate wording accurately, and — as covered earlier — keeping a journal that documents what you did. E&O insurance and good procedure work together: the journal helps your insurer defend you, and disciplined refusals keep you out of the fraudulent transactions that generate the largest claims.
A notary who relies on insurance while cutting procedural corners is still exposed, because intentional or grossly negligent conduct falls outside what E&O will cover.
Common Traps
- "Connecticut requires a $10,000 bond" — false; no bond is required at all.
- "A bond protects the notary" — false; a bond protects the public, and the notary must reimburse the surety.
- "E&O covers intentional fraud" — false; it covers negligence and honest errors, not willful misconduct.
- "The state will pay if I'm sued" — false; there is no state fund, and the notary is personally liable.
A claim is paid out under a notary's surety bond. What happens next?
Which statement accurately describes Connecticut's bond and insurance rules for notaries?