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There are many types of surety bonds that exist out there.  Some of these bonds are in some serious niche industries, such as the auto dealer niche.  Like all other types of surety bonds, these bonds can have claims on them, which will require the auto dealer to pay back the surety.  So, instead of getting a claim made on the bond and then having to come up with extra money to pay the surety back, it is a much better idea to have a compliance system in place to avoid the claim in the first place.
See the article below for some good ways to avoid a bond claim for an auto dealer bond.

http://wardsauto.com/dealer/how-auto-dealers-can-avoid-bond-claims

How Auto Dealers Can Avoid Bond Claims

Even if you’ve never faced the threat of a claim against your auto dealer bond, learning what may bring about such a claim – and how to fight one if it does come – is an essential part of protecting your business.

You may already be bonded, but that only means you’ve fulfilled your legal requirement: a bond claim can still be ruinous.

Fortunately, there are several relatively simple things that can prevent claims from being filed and ensure any unwarranted claims successfully are fended off. That process starts with understanding what a surety bond is.

The first step is getting a firm grip on what we mean by a bond claim. Dealers are legally required to obtain a surety bond to obtain a dealer license. But what do you really know about that bond you purchased?

In essence, the surety bond is a legally mandated insurance you purchase for your customers. It protects them against you, not the other way around. The guarantee of the bond is to pay any claims brought by customers against your dealership.

One important thing to understand is this doesn’t mean a bond claim is no big deal because money is already set aside – far from it. Ultimately, if a claim goes through, you’ll still need to pay it: the bond simply covers the cost in the short term.

Furthermore, if a claim is found to be valid, you are unlikely to be able to get bonded again. That means you’re liable to lose your dealer license and your business in the process.

What's the Difference?

The most important thing you must do to protect yourself is to be aware of the circumstances that can bring a claim against your dealership. This means becoming very familiar with all relevant state and local regulations pertaining to dealing with customers.

Ensuring you operate within all of these regulations is the best way to prevent claims from being filed. However, it still doesn’t guarantee protection.

Many claims filed against bonded businesses are unfounded. If an unfounded claim is filed, several things become important, including your bonding agency. If the agency issuing your bond didn’t underwrite the bond itself, it may not be involved in the claims process.

If, however, the bond was obtained through an agency that underwrites its bonds, it’s in the agency’s interest to protect you against that claim. This is important, because a bonding agency knows the ins and outs of the claims process well, and that will be invaluable in fighting an unfounded claim.

If your bond isn’t underwritten by a surety agency, remember you generally renew your bond each year, so you’re never more than 12 months away from a chance to re-evaluate your bonding options.

If everything goes wrong and you’re out of options, finding ways to resolve a claim before it goes through is essential if your business is to survive. That means looking for a way to settle the claim.

Be a negotiator and work with the claimant to see if there’s a way to resolve the issue. A cash or other type of settlement may be painful in the short run, but your business’s long-term survival will make it more than worth it in the long run.

With these three simple steps, you should feel confident you’re protected against claims. Navigating the complexities of state and local regulations and requirements, however, means there always will be unique cases. If you’re a dealer who’s had any experiences with claims, especially unique claims, please share them with us in the comments.

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