Customs Requirements and Import Bond Insurance

import bond insurance

Customs import bond insurance is basically a guarantee between the surety company issuing the customs bond, the importer of record, and the customs & border protection (CBP) agency. CBP requires all importers to file an import bond in order to clear their entries, even when the goods are duty free. The import bond guarantees CBP will collect all import duties, taxes, fines or penalties. If for any reason they do not receive this from the importer then they have a way to collect from the insurance/surety company who issued the bond.

Customs bonds are required in different situations, for example, when foreign goods are to be imported or handled within the US, including any cargo carrier or freight forwarder importing goods or merchandise into the country, international carriers transporting cargo (or passengers) from a foreign location to the US, and anyone operating a warehouse or facility used to store imported or exported goods.

Brokers are available across the US

Many customs brokers are also agents for sureties and sell import bond insurance. A list of brokers in the state where you operate is available online. Be aware however that some brokers will not issue you a bond without you giving them power of attorney to file your entry on your behalf.

The purpose of a customs bond is to provide a guarantee that the duties, taxes and fees owed to the federal government will be paid. There are both “single entry” and “continuous” customs bonds. The single entry bond is used when only importing once or occasionally, rather than performing services on a regular basis. The continuous bond is used when importing happens on a more regular basis.

Determining the bond amount gets more involved for continuous customs bonds. The CBP provides a document called Monetary Guidelines for Setting Bond Amounts to provide some kind of guidance on how the bond amount is determined. A continuous import bond is good at any US port and can be used by any customs broker or freight forwarder you choose to clear your entries.