Understanding Notary Insurance in California: Types, Costs, and Coverage
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California requires a $15,000 notary bond, but that protects the public, not you. If you want protection for your own mistakes, you need errors and omissions (E&O) insurance. Here is what each one covers and what they cost.
Notary Bond vs. E&O Insurance
These are two different things:
- Surety bond ($15,000): Required by the state. Protects the public if you make an error that causes financial harm. If a claim is paid, you must repay the bonding company. Cost: $38 to $100 for a 4-year term.
- E&O insurance: Optional. Protects you. Covers legal defense costs and damages if you are sued for a notarial mistake. You do not have to repay claims. Cost: $30 to $200 per year depending on coverage amount.
The bond is a legal requirement. You file it with the county clerk when you take your oath. The state will not issue your commission without proof of a $15,000 bond from a licensed surety company. E&O is something you buy for yourself because the bond does not protect you at all.
See our article on the California notary bond for more detail.
How E&O Insurance Works
If someone sues you for a notarial error (wrong name, wrong date, failed ID check), your E&O policy pays for your legal defense and any settlement up to the policy limit. Common coverage amounts are $25,000, $50,000, and $100,000.
Here is how a claim typically works. Say you notarize a deed for someone whose ID has expired. Six months later, the property owner claims the signature was forged and sues everyone involved, including you. Your E&O policy would pay for an attorney to defend you and cover any settlement or judgment, up to your policy limit. Without E&O, you are paying a lawyer $200 to $400 per hour out of your own pocket.
E&O policies usually cover: notarial errors, missed steps in the notarization process, failure to properly verify identity, and mistakes on loan documents for signing agents. They do not cover intentional fraud or criminal acts.
How Much Coverage You Need
Signing agents should carry at least $100,000 in E&O coverage. Title companies often require it. If you only do general notarizations (affidavits, copy certifications, acknowledgments), $25,000 to $50,000 is usually enough.
| Situation | Recommended E&O | Why |
|---|---|---|
| General notary, occasional work | $25,000 | Low risk. Most documents are low-value affidavits and authorizations. |
| Mobile notary, regular clients | $50,000 | Higher volume means more exposure. Real estate and financial documents carry more risk. |
| Signing agent (loan signings) | $100,000 | Title companies often require $100K. Loan documents involve large dollar amounts. |
| High-volume signing agent | $100,000 to $250,000 | Multiple signings per day increases cumulative risk. |
Cost Breakdown
| Coverage Type | Amount | Typical Cost | Term |
|---|---|---|---|
| Surety bond | $15,000 (required) | $38 to $100 | 4 years |
| E&O insurance | $25,000 | $30 to $50/year | 1 year |
| E&O insurance | $50,000 | $50 to $75/year | 1 year |
| E&O insurance | $100,000 | $75 to $200/year | 1 year |
Prices vary by provider. The NNA, Notary Rotary, and several online surety companies sell both bonds and E&O policies. Association members sometimes get group rates that are 15 to 25 percent lower. See our guide on notary association benefits for details on those discounts.
One thing to keep in mind: the bond cost is a one-time payment for your 4-year commission term. E&O renews annually. Over a full 4-year commission, expect to spend roughly $150 to $800 total on insurance, depending on your coverage level.
What Happens Without E&O
If a claim is filed against you and you have no E&O insurance, you pay everything. Legal defense in even a minor notary lawsuit can run $5,000 to $15,000. A settlement or judgment adds to that. The bond covers the public up to $15,000, but the surety company will come after you to repay every dollar they pay out.
Consider a common scenario for signing agents: you accidentally notarize a document with the wrong vesting (how title is held). The borrower claims the property was transferred incorrectly. Title companies, lenders, and the borrower may all name you in the lawsuit. Without E&O, you are hiring your own attorney and paying the full cost of defense, win or lose. For $75 to $200 a year, E&O is cheap protection against a risk that could cost you thousands.
Frequently Asked Questions
Is E&O insurance required in California?
No. Only the $15,000 surety bond is required. E&O is optional but recommended, especially for signing agents.
How much E&O coverage do I need?
General notaries: $25,000 to $50,000. Signing agents: $100,000 minimum, because title companies often require it.
Does the bond protect me?
No. The bond protects the public. If a claim is paid against your bond, you must repay the bonding company. E&O insurance protects you.
Where do I buy a notary bond?
From a licensed surety bond company. NNA, Notary Rotary, and other notary supply vendors sell them. You can also buy E&O from the same vendors when you purchase your bond.
What happens if I make a mistake and have no E&O?
You pay out of pocket for legal defense and any damages. A single lawsuit can cost thousands. The bond pays the injured party, but the surety company will demand repayment from you.
Does E&O cover criminal acts?
No. E&O covers honest mistakes and negligence. It does not cover intentional fraud, criminal acts, or notarizations where you knew the signer was misrepresenting themselves.
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