Rhode Island Auto Dealer Bonds
Auto dealer bonds protect consumers and the state. The bond amount and license type required depend on your state's DMV.
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At a glance
Rhode Island Auto Dealer Bond Key Facts
Governed by R.I. Admin. Code 280-RICR-30-20-1 (Dealers, Manufacturers, and Rental Licenses); R.I. Gen. Laws § 31-5-5 et seq..
The basics
What Is an Auto Dealer Bond in Rhode Island?
Yes — Rhode Island requires an auto dealer bond. A Rhode Island auto dealer bond is a $50,000 surety bond that every licensed motor vehicle dealer must file with the Rhode Island Division of Motor Vehicles (DMV) to get and keep a dealer license. It is a promise, backed by a surety company, that you will follow Rhode Island’s motor vehicle dealer laws and pay the taxes and fees you owe the state. If you break those rules and cost a customer or the state money, the bond can pay them back — up to $50,000 — and you must repay the surety.
Good to know - Required for every motor vehicle dealer. Anyone who sells or brokers more than four (4) vehicles in a calendar year must be licensed (R.I. Gen. Laws § 31-5-5) and file the bond. The amount is a flat $50,000 for all motor vehicle dealers — including moped, motorcycle, wholesale, and auto auction dealers — payable to the DMV, filed yearly with license renewal and in effect until December 31.
The bond is a three-way agreement. You (the dealer) are the “principal,” the Rhode Island DMV is the “obligee” that holds the bond, and the surety company backs it. It protects your customers and the state — not you or your business. If the surety pays a claim, you must pay the surety back.
The amount is a flat $50,000 for every motor vehicle dealer, including moped and motorcycle dealers, wholesale dealers, and auto auction dealers (R.I. Admin. Code 280-RICR-30-20-1). Unlike some states, Rhode Island does not scale the amount by license type or sales volume — it is $50,000 across the board, payable to the DMV.
Not everyone who sells a car needs one. Rhode Island treats you as a dealer only if you sell or broker more than four (4) vehicles in a calendar year (R.I. Gen. Laws § 31-5-5). Once you cross that line, you must be licensed and file the bond. The bond expires every December 31 and is refiled each year with your license renewal.
Qualification
What You Need to Qualify for a Rhode Island Auto Dealer Bond
Approval depends on your dealer license type, required coverage amount, and underwriting factors such as credit.
- You sell or broker more than four (4) vehicles in a calendar year, so Rhode Island treats you as a motor vehicle dealer that needs a license and a $50,000 bond (R.I. Gen. Laws § 31-5-5).
- You know your bond amount is a flat $50,000, payable to the Rhode Island DMV — the same amount for used, new, wholesale, auction, and moped/motorcycle dealers. We issue and file the bond for you.
- You have (or can set up) a permanent business location approved by the Dealers’ License & Regulation Office — at least a 2,400 sq. ft. building and a 2,400 sq. ft. outside area.
- You have a signed, notarized lease for the location (one-year minimum) that states the total building and lot square footage, or a copy of the deed if you own the property.
- You have local zoning approval to sell motor vehicles at that address, or a city/town second-hand dealer license where one is required.
- You can show an approved $50,000 line of credit from a financial institution and a financial statement prepared by a certified public accountant (CPA).
- You are ready to keep the bond current, because it expires every December 31 and is refiled each year with your license renewal.
Step by step
How to Get an Auto Dealer Bond in Rhode Island: Step by Step
Confirm you need a dealer license and bond
Rhode Island treats you as a motor vehicle dealer if you sell or broker more than four (4) vehicles in a calendar year. Dealers must be licensed by the DMV’s Dealers’ License & Regulation Office and must file a $50,000 surety bond. If you sell four or fewer, you are not a dealer under state law.
Set up a qualifying place of business
Secure a permanent business location the Dealers’ License & Regulation Office can approve. It must have at least a 2,400 sq. ft. building and a 2,400 sq. ft. outside area, backed by a signed, notarized lease of at least one year that states the total building and lot square footage, or a copy of the deed if you own it.
Get your business finances in order
Line up an approved $50,000 line of credit from a financial institution and a financial statement prepared by a certified public accountant (CPA). Rhode Island requires both as part of the new-dealership application.
Buy your $50,000 surety bond
Purchase your Rhode Island motor vehicle dealer bond in the required $50,000 amount. Market Canopy issues the bond on the state’s official bond form, made out to the RI DMV in your exact D/B/A name and signed and sealed by the surety — you do not download, complete, or sign the bond form yourself. In most cases we file it with the Dealers’ License & Regulation Office for you.
Complete the New Dealership Application
Fill out, sign, and notarize the New Dealership Application and the employee forms. Follow the DMV’s Instructions for Application for New Dealership, which list every document you must attach, including your CPA financial statement and proof of your $50,000 line of credit.
Instructions for Application for New DealershipFile with the Dealers’ License & Regulation Office and keep the bond current
Submit your application packet, issued bond, lease or deed, zoning/second-hand-license proof, and the license fee (check or money order payable to the “Dealers’ License & Regulation Office”) to the RI DMV at 600 New London Avenue, Cranston, RI 02920. An Investigator reviews it, then a Licensing Aide schedules an appointment to finalize. Each year, refile the bond by December 31 with your license renewal.
2026 Rhode Island Dealers’ License Update InstructionsPaperwork
Rhode Island Dealer Bond Forms & Documents
The main new-dealer application packet and instructions. You complete, sign, and notarize it, then file it with the Dealers’ License & Regulation Office.
View formThe DMV’s annual renewal instructions. Your $50,000 bond is refiled each year with your license renewal.
View formFor franchised new-car dealers, who also submit a Dealer Agreement and a blank Bill of Sale for approval.
View formUsed when an existing dealership changes its business name.
View formThe $50,000 bond, payable to the Rhode Island DMV. Market Canopy issues this on the official bond form in your D/B/A name and files it with the Dealers’ License & Regulation Office for you — you do not fill it out.
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Cost
How Rhode Island Auto Dealer Bond Pricing Works
You do not pay the full $50,000. Rhode Island sets the bond at a flat $50,000 for every motor vehicle dealer. What you actually pay is the premium — a small percentage of that $50,000.
Your premium is set by underwriting, mostly your personal credit and business history. Well-qualified dealers pay the lowest rates. Because the bond runs through December 31, your first-year premium may be prorated to how much of the calendar year is left. Use the quote flow on this page for your exact price; the state license and application fees are separate from the bond premium.
Worked example
Rhode Island sets every motor vehicle dealer’s bond at $50,000 — that is the coverage required by regulation, not your cost. You pay only a premium, a small percentage of the $50,000, based on your credit and business history. Because the bond expires December 31, your first-year premium may be prorated to the part of the calendar year that remains.
Filing
Filing Information
Rhode Island Division of Motor Vehicles (DMV) — Dealers’ License & Regulation Office
Filing notes
Market Canopy issues your $50,000 Rhode Island dealer bond on the official bond form, made out to the Rhode Island DMV in your exact D/B/A (business) name and signed and sealed by the surety with power-of-attorney papers, and in most cases files it with the Dealers’ License & Regulation Office for you. You do not fill out or sign the bond form yourself.
File your New Dealership Application packet — the completed, signed, and notarized application and employee forms, your CPA financial statement, proof of a $50,000 line of credit, your issued bond, your lease or deed, your zoning/second-hand-license proof, and the license fee (check or money order payable to the “Dealers’ License & Regulation Office”) — with the RI DMV Dealers’ License & Regulation Office at 600 New London Avenue, Cranston, RI 02920. An Investigator reviews the file, then a Licensing Aide contacts you to schedule an appointment to finalize.
The bond is annual: under 280-RICR-30-20-1 it must be in effect until December 31 and is refiled each year with your dealer’s license renewal. Keep a current bond on file the whole time you are licensed so your license does not lapse.
FAQ
Rhode Island Auto Dealer Bond FAQ
Yes. Every licensed motor vehicle dealer must file a $50,000 surety bond with the Rhode Island DMV, payable to the Department (R.I. Admin. Code 280-RICR-30-20-1). Anyone who sells or brokers more than four vehicles in a calendar year is a dealer who must be licensed and bonded (R.I. Gen. Laws § 31-5-5).
The bond amount is a flat $50,000 for all motor vehicle dealers, including moped, motorcycle, wholesale, and auto auction dealers. That is the coverage set by regulation, not your cost — you pay only a premium, a small percentage of the $50,000, based on your credit and business history.
No. Market Canopy issues your $50,000 bond on the DMV’s official bond form, made out to the Rhode Island DMV in your exact D/B/A (business) name and signed and sealed by the surety. In most cases we file it with the Dealers’ License & Regulation Office for you.
Anyone who sells or brokers more than four (4) vehicles in one calendar year (R.I. Gen. Laws § 31-5-5). At that point you are a motor vehicle dealer and must hold a DMV dealer license and a $50,000 surety bond. Sell four or fewer and you are not a dealer under state law.
Every December 31. Under 280-RICR-30-20-1, the bond is filed yearly with your dealer’s license renewal and stays in effect until December 31 of that year. Keep a current bond on file continuously so your license does not lapse.
With the RI DMV Dealers’ License & Regulation Office at the Cranston Headquarters, 600 New London Avenue, Cranston, RI 02920. An Investigator reviews your completed file, then a Licensing Aide contacts you to schedule an appointment to finalize the license.
The state license fee is $300 per year per location — $900 for the three-year license, paid $300 per year — plus a like amount for each branch (R.I. Gen. Laws § 31-5-8). The DMV’s new-dealership instructions show $302.50 due at application. These state fees are separate from the surety bond premium.
Your customers and the state. It backs your promise to follow Rhode Island’s motor vehicle dealer laws and to pay the taxes and fees you owe the state. If you break those rules and cause a loss, a valid claim can be paid up to $50,000, and you must repay the surety. It is not insurance for your own business.
Sources
Last verified 2026-07-02. Requirements change - confirm current details with Rhode Island Division of Motor Vehicles (DMV) — Dealers’ License & Regulation Office before you file. This page is informational and not legal advice.
FAQ
Rhode Island Auto Dealer Bond Questions
The cost of a Rhode Island auto dealer bond is usually a small percentage of the state-required bond amount. Your exact premium depends on the bond amount, license type, business details, and underwriting factors such as credit.
Many auto dealer bonds can be issued the same day after you complete the application. Larger bond amounts or applications that need underwriting review may take longer.
Requirements vary by license type, but most Rhode Island auto dealers need to complete a short application and purchase the bond amount required by the state before their license can be issued or renewed.
Often, yes. Many states have separate bond requirements for wholesale, retail, broker, or other dealer license types. Choose the bond that matches your Rhode Island license instructions.
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AutoDealersBond.com is operated by Shield Liability Insurance Agency, a California and Texas licensed insurance agency (CA License #6018195, TX License #3446536). Shield Liability Insurance Agency is not an insurance carrier and does not underwrite bonds or insurance policies. Bond and coverage availability, pricing, and issuance are subject to carrier underwriting approval, eligibility, applicable state requirements, and policy or bond terms. Availability varies by state.
