Notary: Know your liability. Quick test

Test Yourself: Liability Risks
Mistakes can happen when performing a notarization. All too often, Notaries remain unaware of the risks they face and the protections available to them to shield against serious financial consequences. Take our quiz and test your knowledge about liability risks and how prepared you are to deal with them.

Multiple Choice:

• Notaries are required to have insurance protecting themselves from liability:
• In every state
• In California, Florida and New York
• In California only
• In no state
• Who does a surety bond protect from financial loss resulting from a Notary's mistake?
• Both the signer and Notary
• The Notary only
• The signer only
• The agency that issued the document
• An Errors and Omissions Insurance policy protects a Notary from liability costs if:
• The Notary makes an unintentional error
• The Notary deliberately commits an improper act
• The Notary commits either a deliberate improper act or an unintentional error
• The Notary is physically injured by a signer

True or False:

• If a Notary has a surety bond, the Notary does not need Errors and Omissions Insurance.
• True
• False
• A surety bond must be repaid by the Notary if any damages are paid out of the bond.
• True
• False

ANSWERS

1) Answer: D. No state requires Notaries to carry insurance policies protecting themselves from liability damages in the event of a lawsuit. Notaries who make unintentional mistakes and do not have insurance policies may find themselves paying hundreds or thousands of dollars in damages – even if the mistake was not intentional.

2) Answer: C. A surety bond only protects the signer. The bond guarantees that a signer will be repaid up to the bond's maximum amount, should the signer suffer financial loss resulting from an improperly performed notarization. A surety bond does not cover a Notary in any way if the Notary is sued for negligence.

3) Answer: A. An errors and omissions (E&O) policy will cover a Notary who is sued for committing an unintentional error during a notarization; however an E&O policy does not cover deliberate fraud or improper acts committed by a Notary, such as backdating a document, ignoring identification requirements or purposely entering false information on a certificate.

4) Answer: False. A surety bond is not an insurance policy for Notaries. The bond only protects signers from financial loss. Notaries who want coverage protecting themselves from financial loss from a lawsuit must take out an E&O policy for themselves.

5) Answer: True. Any money paid to a signer from a surety bond must be paid back in full by Notary to the bonding company.

The National Notary Association can help. To obtain a quote for the cost of an E&O policy of your own check out their prices at:http://www.nationalnotary.org/bonds_and_insurance/errors_and_omissions/index.html. For more information and additional resources check out their website atwww.nationalnotary.org.