AMVIC Surety Bond (Alberta)
Alberta Motor Vehicle Industry Council Security
An AMVIC Surety Bond is the security required for Alberta Motor Vehicle Industry Council business licenses. The most common are the $50,000 wholesale bond and the $300,000 consignment bond.
These bonds protect AMVIC (and consumers) when wholesale or consignment activity creates financial risk.
Providing a surety bond in lieu of cash or a letter of credit is typically a preferred method of posting security for operations with AMVIC. We offer competitive premiums and quick-write bond placement for qualifying businesses.
Video transcript: AMVIC Surety Bonds in Alberta
Need an AMVIC surety bond in Alberta? An AMVIC bond, sometimes referred to as a general surety bond, is security required by the Alberta Motor Vehicle Industry Council (AMVIC) for certain business licenses. It’s a guarantee to AMVIC that you’ll follow the terms of your license and the regulations AMVIC enforces. It’s a three-party bond between you, the surety company, and AMVIC.
The two most common bond amounts are $50,000 for wholesale and $300,000 for consignment. Qualifying wholesale businesses can often get a quick-write approval with very little underwriting. Consignment requires a review of external accountant-prepared financial statements for the applying business.
You apply online and receive a quote. Once approved and the premium is paid, your bond is issued. The original paper bond is couriered to you, and you submit it to AMVIC directly with your license application. BondConnect provides the bond; it doesn’t issue or process the license.
Get your AMVIC bond online with BondConnect, at bondconnect.ca.
What is an AMVIC Surety Bond?
An AMVIC Bond is a three-party security agreement between the Principal, the Surety Underwriter, and the Obligee.
The bond ensures that the Principal adheres to the regulations and guidelines required by the Alberta Motor Vehicle Industry Council (AMVIC).
The bond acts as a guarantee that the Principal will fulfill its obligations under an AMVIC business license; and if not, the Surety is required to compensate the Obligee for eligible losses up to the bond amount.
It’s important to note that the Principal is still responsible for the amount of the loss by way of an indemnity agreement.
The three parties included in the bond are:
- The Principal – The company or individual seeking the AMVIC licence and responsible for any losses that might occur under the terms of the surety agreement.
- The Surety – The guarantor (often an insurance company) that provides the financial backing for the bond, ensuring the Principal will meet its commitments.
- The Obligee – The party whom the bond’s guarantee is made. For an AMVIC bond, this is the Alberta Motor Vehicle Industry Council, as represented by the Chief Executive Officer of AMVIC.
At Bond Connect, we align your AMVIC licensing requirements with an appropriate Alberta-licensed surety company that will provide an adequate guarantee for your licence class.
Why do I need an AMVIC Bond?
AMVIC requires security for wholesale and consignment business licences because those transactions create a higher risk of financial harm to consumers and industry participants.
As part of your AMVIC licensing requirements for those classes, you must obtain and provide a General Surety Bond, an irrevocable letter of credit, or cash (referred to as security).
It is usually most cost-beneficial to provide the surety bond rather than tying up $50,000 or $300,000 of equity or bank capital.
Security must be delivered directly to AMVIC with your business license application (or when you add consignment to an existing license), and it must remain in force while you hold that license activity.
Can I get a continuous AMVIC Surety Bond?
Yes. Continuous AMVIC General Surety Bonds are the standard type of guarantee issued for this security.
Continuous surety bond validity ensures the bond remains in effect for as long as the Principal requires it, provided all terms are met and premiums are paid. That helps you keep your AMVIC license security in force through renewals without starting from scratch each year.
Who needs which type of bond?
AMVIC’s Licensing Policy sets fixed security amounts for two license activities. Use the table below to match your licence class to the correct bond.
$50,000
Automotive businesses selling only to other automotive businesses (including export) – not to consumers.
$300,000
Businesses selling vehicles to consumers on behalf of consignors under a written consignment agreement.
Bond amount is set by the Registrar.
AMVIC may still require security as a license condition in an amount set by the Registrar.
No bond needed.
Salespeople register with AMVIC separately – they do not purchase this bond.
If you’re unsure whether your operation is wholesale, consignment, or another class, please contact AMVIC licensing to confirm.
AMVIC Wholesale Bond ($50,000)
The AMVIC Wholesale Bond is the $50,000 security typically required for an AMVIC wholesale business licence.
Wholesalers sell, consign, or exchange vehicles with other automotive businesses – not with consumers – and may export vehicles. AMVIC requires this security because wholesale activity can still create financial risk in the motor vehicle industry.
Underwriting / how approvals work
Fast-track for qualifying $50,000 applications:
For the $50,000 AMVIC Wholesale Bond, we can usually issue with light underwriting when you can answer no to all of the following:
- Has the company declared bankruptcy?
- Have you ever had a claim with a surety?
- Have you ever been denied a bond in the past?
If those three answers are no, you’re typically approved up to $50,000.
AMVIC Consignment Bond ($300,000)
The AMVIC Consignment Bond is the $300,000 security required for an AMVIC consignment business licence.
Consignment dealers sell vehicles to consumers on behalf of consignors under a signed consignment agreement. Because consumer funds and vehicle ownership are involved, AMVIC requires a higher security amount than wholesale.
Providing a surety bond instead of cash or a letter of credit helps free up working capital that would otherwise be locked for the full $300,000.
Underwriting / how approvals work
Financial review required:
The $300,000 AMVIC Consignment Bond requires review of external accountant-prepared financial statements for the business pursuing the bond. We’ll guide you on what to send and match you with an appropriate Alberta-licensed surety.
How much does a General Surety Bond in Alberta cost?
The cost of an AMVIC Surety Bond depends on specific variables such as the bond amount, applicant eligibility, and more. The $50,000 Wholesale AMVIC Bond starts at just $795 CAD per year.
As your surety broker, we always strive to obtain the best rates available in the market. Completing an application and/or pursuing a quote does not cost anything and does not commit you to making a purchase.
We use top A.M. Best rated surety guarantors like Intact Insurance to place these bonds.
Competitive Pricing
Reliable Underwriters
Automated Renewal Reminders
Continuous Bond Options
Online Bond Application
How It Works
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