The SR-22 bond and the cash deposit

An insurer's certificate is one way to give proof. The statutes list two more: a bond and a deposit. Neither is cheaper insurance — both set aside money a court can collect from.

What people mean by an “SR-22 bond”

“SR-22 bond” is not a term any statute read for this site uses. What the statutes do say is that the certificate from an insurer is only one way to give proof of financial responsibility. The same chapters almost always list two others: a bond, and a deposit of cash or securities with a state official. Either one stands in for the insurance certificate, and either one is what someone searching for an SR-22 bond is usually trying to find.

The alternatives are not cheaper versions of insurance. A bond or a deposit does not pay anyone's claim for you in the way a policy does — it sets aside money or property that a person who wins a judgment against you can collect from. That difference shapes everything below.

The states, side by side

Eight states' sections on bonds and deposits have been read for this site. The deposit amounts are not the same as the policy limits, and they are not the same as each other: Montana requires $55,000, while South Dakota, Wyoming, North Dakota and Hawaii require $25,000.

The bond: a surety company, or two neighbors with land

Every bond section read here allows a bond from a surety company authorized in the state. In Alabama, Montana, South Dakota, Wyoming and North Dakota, the section also allows something older: a bond signed by at least two individual sureties who own real estate in the state. Alabama, Montana, South Dakota and North Dakota require that real estate to be worth at least twice the amount of the bond; Wyoming's section requires the real estate to be scheduled in the bond but does not state a multiple.

The bond becomes a lien on the sureties' land

Several of these sections turn the bond into a lien. In Montana, once the department files notice with the county clerk and recorder, “the bond constitutes a lien in favor of the state upon the scheduled real estate of any surety.” Wyoming and North Dakota say the same, and give a judgment creditor the right to sue the sureties directly if a final judgment is not paid — within thirty days of becoming final in Wyoming, sixty days in North Dakota.

Ten days' notice before a bond ends

A bond filed as proof cannot simply be withdrawn. Each bond section read here makes it non-cancelable except after ten days' written notice to the department — the same notice period many states apply to an insurer's certificate.

The deposit: cash or securities with the state

The deposit route is a certificate from a state official — a treasurer, a transportation director or a county administrator — that the person has lodged a fixed sum. In every state that names an amount, the deposit is accepted only with evidence that the depositor has no unsatisfied judgments in their county. The money is then held to pay judgments arising from the person's driving after the deposit was made, and is not otherwise subject to attachment.

Why the amount is not the policy limit

A policy carries three separate limits — per person, per accident, property. A deposit is one pot. Montana's $55,000 and Alabama's $50,000 are single sums that have to answer every claim from every accident until the proof period ends.

South Dakota prices securities higher than cash

South Dakota sets two figures in one sentence: $25,000 “in cash, or securities… of a market value of” $30,000. The higher figure for securities is a cushion against their value falling while they are held.

Alaska repealed it

Alaska still allows a surety bond, but its money-or-securities section reads, in full, “[Repealed, § 15 ch 70 SLA 1984.]” A page that offers an Alaska cash deposit is describing a route that has not existed for four decades.

Maine renews it every year

Maine ties the deposit to the policy amounts rather than a fixed sum, and the Secretary of State issues a certificate of compliance for no more than one year at a time. The depositor has to resubmit a statement a month before it expires, and the certificate is revoked if the deposit's value stays below the required amount for thirty days.

Who actually uses this

The sections themselves suggest the answer. A deposit ties up a large fixed sum for the whole proof period; a personal-surety bond ties up two people's land. Both are built for someone who has assets and no insurer willing to write them — or a business. For a driver who simply needs a filing, the insurance certificate is the route the chapters treat as normal, and the one the SR-22 guide describes.

The proof period does not change with the route. A bond or a deposit has to stay in place for the same length of time as a certificate would; the filing-period guide has each state's clock.

Common questions