In the state of Arizona, all freight brokers need a license in order to offer brokering services. Freight broker licenses help ensure that the licensee carries out freight brokering duties in accordance with shipping laws and transportation laws. These duties include:
- Finding shippers (clients) that need goods transported.
- Sourcing quick and efficient transportation (carriers) for a shipper's goods.
- Negotiating pricing with both shippers and carriers.
- Acting as a middleman for shippers and carriers.
- Tracking freight from its pickup point to its destination.
- Invoicing and preparing quotes.
To effectively complete these duties, a freight broker needs to have excellent communication and problem-solving skills, be highly organized, and be able to work at a fast pace. In return, they can enjoy a rewarding career that offers many perks, which includes a flexible schedule, the ability to work from home, and a scalable salary. According to the U.S. Bureau of Labor Statistics (BLS) and Zippia, Arizona freight brokers make an average of $51,800 annually—making it the 11th best state for freight broker salary.
Find out more about becoming an Arizona freight broker below. We cover not only how to get an Arizona freight broker license, but also the best way to upgrade your freight broker skills and knowledge for a successful career.
Licensing Requirements of a Freight Broker in Arizona
Arizona has no state-specific certifications for freight brokers. Instead, all licensing is done at a national level through the Federal Motor Carrier Safety Administration (FMCSA). Arizonans applying for this license must:
- Be a minimum of 18 years of age.
- Have a high school diploma or GED.
- Register with the U.S. Department of Transportation (USDOT).
- Pay a non-refundable application fee (currently $300).
- Be bonded with a $75,000 freight broker bond (BMC-84 bond).
- Have a business insurance policy.
- Secure a process agent licensed in Arizona.
- Not have any disqualifying criminal convictions.
See the next section for more details on these licensing requirements.
Steps to Get a Freight Broker License in Arizona
Step 1: Register Your Broker Business
After you choose a business structure (sole proprietorship, partnership, LLC, or corporation) and a name, you need to register your business with:
You may also need to register your business with the city in which your brokerage business is located.
Note: This step does not apply to individuals that plan to work at an existing freight brokerage.
Step 2: Get a USDOT Number & USDOT PIN
Use the FMCSA's Unified Registration System (URS) to apply for a USDOT Number. If your application is successful, you will get a USDOT Number with a USDOT PIN.
Step 3: Choose Your Operating Authority
There are two types of operating authorities for freight brokers, and you may choose one or both. What you choose will not only affect what kind of freight you can broker but also impact the type of insurance you need.
- Broker of Property: arranges the transportation of property (excluding household goods) belonging to others using an authorized Motor Carrier.
- Broker of Household Goods: arranges the transportation of household goods (personal items and property that is used in a home) belonging to others using an authorized Motor Carrier.
Step 4: Apply for Your Operating Authority (MC Number)
Use Form OP-1 to apply for your operating authority, also known as a broker authority. Successful applicants will get a Motor Carrier Number (MC Number). Your insurance company needs this number to make the appropriate filings.
Cost: the application fee is $300 for each operating authority you apply for.
Step 5: Get a Surety Bond
The FMCSA requires all freight brokers to have either a $75,000 trust fund agreement (form BMC-85) or a freight broker bond (form BMC-84). These ensure that if a freight broker ever conducts business unethically or unlawfully, the affected party will be compensated financially for any losses and damages,
Many freight brokers opt to get bonded since it doesn't tie up $75,000 in cash—it only costs a small fraction of that amount. Those with good credit only pay approximately 1% - 5% of the $75,000 ($750 - $3,750) to get bonded.
Have bad credit? You can often still get bonded at a higher rate. See our Bad Credit Surety Bond Guide for more information and answers to FAQs.
Step 6: Get Insured
The insurance you need will depend on which operating authority you apply for. Common policies required include:
- Bodily injury and property damage insurance (Form BMC-91 or BMC-91X)
- Cargo liability insurance (BMC-34)
Your insurance company can complete these insurance filing requirements at your request. They must be received within 90 days of the filing date of your application.
Freight Broker Bonds vs. Insurance
Freight broker bonds protect shippers/motor carriers, not freight brokers.However, freight broker insurance does protect freight brokers.
Many new freight brokers that invest the bare minimum on insurance coverage quickly realize they are disqualified from working with larger shippers. Each year, more freight brokers are pulled into litigation, and ultimately go out of business due to huge judgments and legal fees they can’t afford.
Although insurance is not required to operate, the most important reasons to have it in place are to:
- Protect your bottom line
- Create increased security around your bond, and avoid leaving yourself open to paying legal fees by not purchasing insurance.
- Increase top line: by having insurance, you become more attractive in today's marketplace to shippers and wholesalers.
Freight Broker Insurance Types
There are several types of insurance coverages that are recommended for freight brokers; please see the list below:
- Business owner’s policy (BOP)
- General liability
- Workers' compensation
- Commercial auto
- Professional liability/errors and omissions (E&O)
- Contingent cargo
- Contingent auto liability
If you’d like to learn more about all of the insurance coverages available to you, please read our freight broker insurance guide.
Step 7: Designate an Arizona Process Agent
A process agent, also known as a processing agent, gets served the paperwork if a claim gets filed against you. Here is what you need to know about designating one:
- Getting an Arizona process agent is essential to being able to legally work in the State of Arizona.
- For each state that you plan to write contracts or have an office, you must have a process agent for that location.
- Operating in multiple states? You may want to consider a blanket company. This type of company can provide process agents that work in every state.
To designate a process agent, submit form BOC-3 to the FMCSA. If you work with a blanket company, they can complete this step on your behalf.
Freight Broker Programs in Arizona
Freight brokers are not required to have any training or education beyond high school. However, a freight broker training course can be invaluable, especially for those without experience in the logistics or transportation industry. These courses give you the knowledge you need to succeed as a freight broker, which includes everything from basic brokering skills to how to market your own brokerage business.
Top Arizona Freight Broker Training Schools:
Load Training: This in-person training course is a 5-day intensive in Phoenix, Arizona. Private 3-day classes are also available.
Brooke Training Solutions: Online courses offered for both beginner and advanced freight broker training. They also offer in-person classes, but unfortunately, not in AZ at this time.
Online Freight Broker/Agent Training: Jeff & Jan Roach are industry experts that offer online training programs through a variety of institutions. This training will help you define your business goals, all while learning freight brokering basics, laws, software, and more. Enrollment is always open for these as it is self-paced.
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