A notary public is an appointed position by the Secretary of State's department in a given state. Just like most public officials, the State specifies that the person get a notary bond before getting the commission. This bond "makes sure" that when the official violates the public trust through neglect of their duties, funds are available to indemnify the State for its loss.

The main responsibility of notaries is to validate that the individual parties to a contract are who they claim to be. The State may suffer a loss if the notary fails to properly ensure the identity of the parties.

As a public official, the notary violates the public trust by failing in their responsibility to confirm identity. If a District of Columbia notary doesn't confirm identity and a loss occurs, an injured party can file a claim against that State for their loss, because the State was negligent through its appointed representative.

A surety bond is a promise to pay to the obligee (the State) if losses occur for a penalty amount of the bond. Surety bonds are often provided by a surety company (typically an insurance carrier). The bond generally runs concurrently with the period of a notary's commission.

You're probably familiar with a truck insurance policy. If a person has an auto insurance in Indiana loss, the insurance company pays the claim and writes off the loss. You aren't required to reimburse the company for the damages. Unlike an auto insurance policy however, a notary bond is simply a promise that the funds will be available when losses occur. The surety (insurance company) pays the State up to the penalty amount of the bond. However, this claim paid by the carrier is not simply written off. The carrier will most likely seek reimbursement from the bonded person, the notary themself.

A notary bond protects the public. Who protects the notary? Insurance coverage is available to provide this protection - it's called Notary Errors and Omissions and may also be purchased for a nominal fee from insurance companies.