A bond can be thought of as a certain kind of insurance policy which the laws of some states require a notary (as well as other public officials) to purchase.  The amount of the bond is usually prescribed by law or regulation, and the notary is required to keep the bond in force in order to remain commissioned as a notary.

A key thing to remember about bonds is that they do not protect the notary – they are designed to protect any member of the public who is damaged by the notary’s failure to perform his or her notarial duties.

The notary usually purchases the bond from a commercial bonding company, paying a one-time fee in advance for coverage lasting for a specified period of time, usually one to four years.  The terms of the bond usually go something like this:  If the notary fails – for any reason – to “faithfully discharge the duties of a notary public in accordance with the laws of this state…” – and – as a result someone sues the notary in court and wins a judgment for damages – and – the notary is unable to pay the award – then – the person who sued the notary can “call” the bond and demand that the bonding company pay the award.  In short, the bond provides a “deep pocket” from which the person who sued the notary can collect the award.  Unfortunately, that is not the end of the notary's problems, because the bonding company is then entitled to sue the notary and collect the amount they paid out to satisfy the orginal judgment!

An “errors and omissions” liability insurance policy protects the notary from the financial burden of a damages award.  A bond does not provide any protection to the notary at all.