Executor Bonds Explained
They are needed in cases when a party is assigned as the executor of a deceased person's will. A probate court may then require an executor bond in order to ensure that the executor will act lawfully, thus protecting the interests of family members and heirs of the deceased.
The executor bond represents a contract between the executor as the principal, the court as the obligee, and the surety as the bond provider.
Questions about Court Bonds/executor Bonds
Who needs this bond?
Frequently, fiduciaries, executors, and/or trustees are required to be bonded before they will be entrusted with the task of taking care of a person's affairs in the event of their death or incapacitation. An executor is, in essence, the person assigned by the deceased or by a probate court to carry out the final wishes in regards to property and assets. Typically, the executor has to get in touch with the heirs on the will, safeguard and distribute the estate accordingly, and handle any pertinent administrative tasks.
As sometimes required by the court, an executor bond guarantees faithful performance by the executor of an estate in the proper allocation of the assets of the deceased or incapacitated individual with whom they owe a fiduciary duty to.
What is the executor bond cost?
The surety bond cost that you have to pay to get bonded is formulated on the basis of the bond amount you have to obtain as an executor. This amount depends on the estate's value and is set by the court. You have to cover a small percentage of the required amount, which is known as the bond premium.
Your surety has to consider your personal credit score and finances in order to determine the bond cost. This way, it aims to assess how likely you are to pay costs on proven claims against the executor bond if anything were to be mishandled. The stronger your financial profile is, the smaller the bond premium is likely to be. Collateral may also be needed in some cases.
What happens if I have bad credit?
It's very difficult to get an executor bond with bad credit, and may actually be virtually impossible. In general, court bonds are underwritten to applicants with a satisfactory level of financial strength. The bonding decision will depend on a thorough overview of your finances.
How Do I Get Bonded?
In order to obtain an executor bond, you have to do the following:
Fill them out and send them to [email protected] or fax them to (267)-362-4817.
Need to delve deeper into the bonding process? We have created an in-depth guide that you can consult on our How to Get Bonded page.
If you have further questions, you can get in touch with our bonding experts to get assistance. You can reach us at (877) 514-5146.
What if I receive a claim against my surety bond?
As a bonded executor of a will, you may receive a claim against the bond in case you transgress from your obligations, and engage in unlawful actions that harm the estate that is entrusted to you or the interests of the will's beneficiaries. The claimants can then seek a reimbursement up to the penal sum of the bond.
The surety that bonded you may cover the costs initially, as to ensure a fast compensation to the harmed parties. However, the liability is still yours, so you will need to pay back the surety soon after. Thus, claims are to be avoided, as they remain your full financial responsibility.
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