In most jurisdictions,a public notary can not be held liable for the truth or accuracy of a document that he or she notarized. The notary’s job is to verify the signer’s identity (e.g. checking driver’s license, passport, government-issued ID card, etc.) and watch the signer signs the document. When these actions are complete, the notary will add his or her official stamp to the document to confirm a successful execution.
But there are times when a court may require a public notary to pay for certain errors made on a notarized document. If the notary’s negligence or misconduct caused financial damage to the signer or any respective parties, for instance, the notary may be held liable for these losses. Depending on the size and scope of the error, along with the financial loss is created, a notary could have his or her savings account wiped out, assets seized, and business destroyed.
Thankfully, there’s a simple solution to this problem: errors and omissions insurance. Errors and omissions insurance is designed to protect notaries from mistakes and errors that cause financial loss to their clients. Notaries are only human, so mistakes are bound to happen at some point or another. It only takes a brief lapse in judgment, however, to place a notary in hot water. If the notary has errors and omissions insurance, he or she will be financial protected from damage caused by their mistakes. Think of it as a lifeline that gives the notary peace of mind knowing he or she is safe in the event of an erroneous action taken during a notarization act.
Notaries are in no way required to purchase errors and omissions insurance. It’s completely optional and at the sole discretion of the notary. While laws governing notaries varies from state to state, no jurisdiction in the U.S. requires notaries to have errors and omissions insurance.
It’s a common assumption among notaries that being “bonded” protects them from financial loss caused by notarization mistakes. In reality, a bond only protects the client; it does not protect the notary. And if the bond has to issue a payment to a client, the notary is responsible for paying it back.
It’s also important to note that a notary can be sued without any wrongdoing. If a client believes you made a mistake, and has enough evidence to convince a judge, the court may rule in the client’s favor. The good news is that errors and omissions insurance will cover financial judgments in instances such as this as well.
In addition to investing in errors and omissions insurance, notaries can also protect themselves from lawsuits by:
- Require the signer to sign the document in your physical presence.
- Never agree to backdate a document.
- Verify the signer’s identity.
- If the state requires a journal, the notary should create a journal entry in sequential order for each notarized act.
Notary Errors and Omissions Insurance Guide