49 Cfr 387.309

Federal Motor Carrier Safety Administration, DOT
limits of liability prescribed herein is
in effect. The broker license shall remain valid or effective only as long as
a surety bond or trust fund remains in
effect and shall ensure the financial responsibility of the broker.
(b) Evidence of Security. Evidence of a
surety bond must be filed using the
FMCSA’s prescribed Form BMC 84. Evidence of a trust fund with a financial
institution must be filed using the
FMCSA’s prescribed Form BMC 85. The
surety bond or the trust fund shall ensure the financial responsibility of the
broker by providing for payments to
shippers or motor carriers if the broker
fails to carry out its contracts, agreements, or arrangements for the supplying of transportation by authorized
motor carriers.
(c) Financial Institution—when used in
this section and in forms prescribed
under this section, where not otherwise
distinctly expressed or manifestly incompatible with the intent thereof,
shall
mean—Each
agent,
agency,
branch or office within the United
States of any person, as defined by the
ICC Termination Act, doing business in
one or more of the capacities listed
below:
(1) An insured bank (as defined in
section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h));
(2) A commercial bank or trust company;
(3) An agency or branch of a foreign
bank in the United States;
(4) An insured institution (as defined
in section 401(a) of the National Housing Act (12 U.S.C. 1724(a));
(5) A thrift institution (savings bank,
building and loan association, credit
union, industrial bank or other);
(6) An insurance company;
(7) A loan or finance company; or
(8) A person subject to supervision by
any state or federal bank supervisory
authority.
(d) Forms and Procedures—(1) Forms
for broker surety bonds and trust agreements. Form BMC–84 broker surety
bond will be filed with the FMCSA for
the full security limits under subsection (a); or Form BMC–85 broker
trust fund agreement will be filed with
the FMCSA for the full security limits
under paragraph (a) of this section.

§ 387.309

(2) Broker surety bonds and trust fund
agreements in effect continuously. Surety
bonds and trust fund agreements shall
specify that coverage thereunder will
remain in effect continuously until terminated as herein provided.
(i) Cancellation notice. The surety
bond and the trust fund agreement
may be cancelled as only upon 30 days’
written notice to the FMCSA, on prescribed Form BMC 36, by the principal
or surety for the surety bond, and on
prescribed Form BMC 85, by the
trustor/broker or trustee for the trust
fund agreement. The notice period
commences upon the actual receipt of
the notice at the FMCSA’s Washington, DC office.
(ii)
Termination
by
replacement.
Broker surety bonds or trust fund
agreements which have been accepted
by the FMCSA under these rules may
be replaced by other surety bonds or
trust fund agreements, and the liability of the retiring surety or trustee
under such surety bond or trust fund
agreements shall be considered as having terminated as of the effective date
of the replacement surety bond or trust
fund agreement. However, such termination shall not affect the liability of
the surety or the trustee hereunder for
the payment of any damages arising as
the result of contracts, agreements or
arrangements made by the broker for
the supplying of transportation prior
to the date such termination becomes
effective.
(3) Filing and copies. Broker surety
bonds and trust fund agreements must
be filed with the FMCSA in duplicate.
[53 FR 10396, Mar. 31, 1988]

§ 387.309 Qualifications as a self-insurer and other securities or agreements.
(a) As a self-insurer. The FMCSA will
consider and will approve, subject to
appropriate and reasonable conditions,
the application of a motor carrier to
qualify as a self-insurer, if the carrier
furnishes a true and accurate statement of its financial condition and
other evidence that establishes to the
satisfaction of the FMCSA the ability
of the motor carrier to satisfy its obligation for bodily injury liability, property damage liability, or cargo liability. Application Guidelines: In addition

1067

VerDate Aug<04>2004

01:54 Nov 03, 2004

Jkt 203208

PO 00000

Frm 01067

Fmt 8010

Sfmt 8010

Y:\SGML\203208T.XXX

203208T

§ 387.311

49 CFR Ch. III (10–1–04 Edition)

to filing Form BMC 40, applicants for
authority to self-insure against bodily
injury and property damage claims
should submit evidence that will allow
the FMCSA to determine:
(1) The adequacy of the tangible net
worth of the motor carrier in relation
to the size of operations and the extent
of its request for self-insurance authority. Applicant should demonstrate that
it will maintain a net worth that will
ensure that it will be able to meet its
statutory obligations to the public to
indemnify all claimants in the event of
loss.
(2) The existence of a sound self-insurance program. Applicant should demonstrate that it has established, and
will maintain, an insurance program
that will protect the public against all
claims to the same extent as the minimum security limits applicable to applicant under § 387.303 of this part. Such
a program may include, but not be limited to, one or more of the following:
Irrevocable letters of credit; irrevocable trust funds; reserves; sinking
funds; third-party financial guarantees,
parent company or affiliate sureties;
excess insurance coverage; or other
similar arrangements.
(3) The existence of an adequate safety
program. Applicant must submit evidence of a current ‘‘satisfactory’’ safety
rating by the United States Department of Transportation. Non-rated carriers need only certify that they have
not been rated. Applications by carriers with a less than satisfactory rating will be summarily denied. Any selfinsurance authority granted by the
FMCSA will automatically expire 30
days after a carrier receives a less than
satisfactory rating from DOT.
(4) Additional information. Applicant
must submit such additional information to support its application as the
FMCSA may require.
(b) Other securities or agreements. The
FMCSA also will consider applications
for approval of other securities or
agreements and will approve any such
application if satisfied that the security or agreement offered will afford

the security for protection of the public contemplated by 49 U.S.C. 13906.
[48 FR 51780, Nov. 14, 1983 and 51 FR 15008,
Apr. 22, 1986, as amended at 52 FR 3815, Feb.
6, 1987; 62 FR 49941, Sept. 24, 1997; 68 FR 56199,
Sept. 30, 2003]

§ 387.311 Bonds and certificates of insurance.
(a) Public liability. Each Form BMC 82
surety bond filed with the FMCSA
must be for the full limits of liability
required under § 387.303(b)(1). Form
MCS–82 surety bonds and other forms
of similar import prescribed by the Department of Transportation, may be
aggregated to comply with the minimum security limits required under
§ 387.303(b)(1) or § 387.303(b)(2). Each
Form BMC 91 certificate of insurance
filed with the FMCSA will always represent the full security minimum limits required for the particular carrier,
while it remains in force, under
§ 387.303(b)(1) or § 387.303(b)(2), whichever is applicable. Any previously executed Form BMC 91 filed before the
current revision which is left on file
with the FMCSA after the effective
date of this regulation, and not canceled within 30 days of that date will be
deemed to certify the same coverage
limits as would the filing of a revised
Form BMC 91. Each Form BMC 91X certificate of insurance filed with the
FMCSA will represent the full security
limits
under
§ 387.303(b)(1)
or
§ 387.303(b)(2) or the specific security
limits of coverage as indicated on the
face of the form. If the filing reflects
aggregation, the certificate must show
clearly whether the insurance is primary or, if excess coverage, the
amount of underlying coverage as well
as amount of the maximum limits of
coverage. * Each Form BMC 91MX certificate of insurance filed with the
FMCSA will represent the security
limits of coverage as indicated on the
face of the form. The Form BMC 91MX
must show clearly whether the insurance is primary or, if excess coverage,
the amount of underlying coverage as
*NOTE: Aggregation to meet the requirement of § 387.303(b)(1) will not be allowed
until the completion of our rulemaking in Ex
Parte No. MC–5 (Sub-No. 2), Motor Carrier and
Freight Forwarder Insurance Procedures and
Minimum Amounts of Liability.

1068

VerDate Aug<04>2004

01:54 Nov 03, 2004

Jkt 203208

PO 00000

Frm 01068

Fmt 8010

Sfmt 8010

Y:\SGML\203208T.XXX

203208T