The state of Washington may require a person or company take out a probate bonds should that person or company be in charge of a person’s estate, will, or trust. Even if the court does not specifically require a surety bond, the person or company charged with overseeing another’s assets may want to take that extra step and receive a bond so they can protect themselves against legal recourse should an outside party find fault with their actions.
Here are a few types of probate bonds that may be required in the state of Washington: administrator bond, curator bond, trustee bond, guardianship bond, receiver bond, custodian of veteran bond.
Courts require an administrator bond (also known as a personal representative or executor bond) when a person or firm is placed in charge of a person’s estate after their death. The administrator must post the bond to financially cover the distribution of assets. This gives the estate legal protection should the assets be mishandled and debts are not paid.
Another type of estate protection is a curator bond. The court will determine how much the bond should cover by reviewing how much the estate assets are worth. Like an administrator, a curator bond protects the heirs and those who are owed money by a deceased estate.
A trustee bond is what it sounds like, a bond that protects the trust from any financial losses should the trustee not fulfill his or her obligations managing the trust. Often times the court requires this type of probate bond to protect the financial interest of the trust recipients. Without this protection people are vulnerable to a large financial loss.
When a person has been appointed guardian over another individual or an estate they must take out a probate bond to ensure the court they will handle the account in good faith. Should the court find that the guardian overstepped their bounds or did not live up to the expectation they can fall back on this probate bond to provide restitution to the estate.
A company that is going through bankruptcy may be required by the Washington courts to take out a receiver bond, a type of surety bond. This probate bond shows the court that the company will take care of any outstanding bills, rent, or debts. Should any mishandling of the accounts occur, the receiver bond will provide jurisdiction protection. The bond amount will be determined by the courts to insure any wrong action taken by the overseers of the account will not result in further financial loss to those who are owed funds.
Custodian of Veteran Bond
This type of bond protects a member of the armed services who has been declared incapacitated. The man or woman who served their country and invested money with Veterans Affairs will be taken care of by a custodian of veteran bond. Like a guardianship bond, this probate covers the soldier’s estate and protects the veteran’s assets from being misused or mishandled.
What do all these probate bonds have in common? They are all designed to protect the estate, heirs to the estate, or the individual deemed incapacitated. Any financial mishandling will not result in a loss to the individual, instead the probate bond will protect them against any financial loss and give them peace of mind knowing that their bills will be paid and their financial livelihood will be upheld.
We at Jurisco are asked all the time: How do you properly discharge (or exonerate) a surety bond once it is no longer necessary, or after all the claims are settled. More specifically, what does the court require and what does the surety company require to be satisfied that there won’t be any future claims coming against the bond? This can be a big headache for surety, the court and your clients if not handled properly. For one, if not properly notified, the surety company will assume that the bond is still active and will continue to operate as such; i.e. keep the risk on their books and bill the client for annual premiums. This can lead to an accounting hassle for the client as they had been operating as their obligation to the surety (and all claimants was satisfied).
What the surety and the courts are looking for is: A statement from the court stipulating that “The Surety is released from all future liability and claim against the bond” Sometimes this will be found in the settlement agreement. In a non-settled case this language is generally found in the satisfaction of judgement. Surety companies also look for an ‘order of discharge’ from the court stating that the Surety is released from all liability and claims against the bond. The ‘Order of discharge’ is most often used in probate and elder care cases where bond is required to be kept current throughout the duration of care in a guardianship/conservatorship or for the duration of fiduciary responsibilities is a personal representative is managing an estate through the probate process.
If you have any question about any part of the surety bond process, please contact the experts at Jurisco and one of their staff will be happy to answer any of your queries.
Taking Care of Loved Ones With Guardianship Bonds in California
A recent article on Huffington Post by anti-elder abuse advocate Carol Herman outlines the much too common tragedy of when Guardians neglect and abuse their wards (full article found here: http://www.huffingtonpost.com/carole-herman/conservatorships-beware_b_1785309.html)
As the baby boomer generation gets older they are reminded just how much times have changed when their kids no longer have the funds nor the time to take care of them as they would just a few decades ago. Now families live in single unit housing and are often separated by state lines from their loved ones. This can make it especially hard when that special person in your life is declared incompetent or where a judge has ruled that a guardian should be named to oversee an estate or a person’s life.
Think of a guardianship bond as extra protection for the ones you hold most dear because in reality that is what it is doing. With this type of surety bond, Jurisco can protect your estate and family by making sure the guardian does everything he/she is supposed to do and without making too many withdrawals from the family bank. A guardianship bond serves as a surety to ensure the guardian upholds their end of the bargain and does so with no ill will.
Loved ones can be declared incompetent due to age, disease, or for any number of reasons. If you think this ruling has been unjust, Jurisco can help you there too. Using this type of surety bond brings peace of mind to people who cannot be there physically to do the work of a nurse, hospice worker, or other at home aide worker. A guardianship bond will protect your loved one’s interests and help ensure their quality of life does not decline simply because they are declared incompetent.
While this scenario rings true with grandparents and the elderly, age isn’t going to stop the court from ruling someone incompetent. Children who are under the age of 18 may require a guardianship care should they lose their parents, for example.
Whatever the reason, Jurisco can help secure a guardianship surety bond that will protect the interest of the family, business, or estate. Our team has the tools necessary to help make the transition an easy one and make sure everyone is on the same page. At the end of the day we just want to ensure people are taken care of the way they deserve to be. Let us help you by helping them.
As one of the most experienced surety bond agencies in the California, we at Jurisco help thousands of clients every year when they are seeking a Personal Representative Bond (aka Executor Bond). Two questions we often receive are, “What is the process for selling real estate under probate?” And, more specifically, “What is the difference in Personal Representative responsibilities for ‘full authority’ and ‘limited authority’ designations?” As to the latter question, the main difference is in reporting to the court; but more on this in a minute. For the former question, well, there are many resources to help with Probate sales of real property.
Article in the San Francisco Chronicle online (full link: here), and on Fox Business online (full link: here), describe the process of a probate sale of real property, including the steps required by the Personal Representative. The most detailed summary of the probate sale process, however is provided by the California Association of Realtors (CAR) found: here. The thorough people at CAR answer almost four dozen of the most important questions a Personal Representative or real estate professional need to know before entering into a probate sale.
Remember the second question from above? “What are the differences between “full” and “limited” authority pertaining to a probate sale?” The differences are outlined in the Independent Administration Of Estates Act (IAEA). As described on the CAR website and under the IAEA:
If the court grants only limited authority to the personal representative, he/she has the power to do all acts allowed under the IAEA rules except the power to: (1) sell real property, (2) exchange real property, (3) grant an option to purchase real property; or (4) borrow money with a loan secured by an encumbrance on real property. With limited authority, court supervision is required.
On the other hand, full authority granted under IAEA rules allows the personal representative to sell real property, exchange real property, grant an option to purchase real property, or borrow money with a loan secured by real property at his or her discretion. (Link)
So you can see the primary differences between ‘full’ and ‘limited’ authority are the ability to sell real property without court supervision. This is an important factor to consider if you are interested in probate sales or if you have been appointed personal representative and the estate you are administering includes real property.
Since this post is dealing with probate sales, many of the Personal Representatives mentioned above would be required to be bonded in order that other beneficiaries of the estate and all creditors will be satisfied that faithful execution of fiduciary responsibilities will be carried out. If you or your clients have any questions regarding Personal Representative Bonds or probate sales of real estate, contact the surety bond experts at Jurisco and one of their friendly staff will answer all your questions.
Who needs estate planning in Colorado? This questions was posed by Wayne Farlow in ColoradoBiz.com (see full article here: http://www.cobizmag.com/articles/who-needs-estate-planning). The answer is pretty straight forward: Anyone who is going to die. Not to be morbid, but that is the simple truth. No matter the size of your estate, a little planning can save your beneficiaries a lot of hassle after your passing (at a ripe old age, surrounded by your loved ones). Without planning your estate will have to go through probate court which will cost your estate money and may even result in the judge requiring a probate bond (or personal representative bond) for the individual selected to manage the distribution of your estate. Now, in case that last sentence piqued your interest. Let me further explain the Probate Bond: A personal representative bond is required by the state of Colorado to protect the interest of the deceased’s estate, its heirs and those parties who are owed money. The responsibility of a personal representative (formally referred to as an executor in Colorado) is taken seriously by the courts. Courts mandate the surety bond as a form of protection for all parties. While the surety bond protects the heirs and creditors of the estate, it is also a protection for the personal representative to ensure she/he fulfills their duties responsibly. Being Appointed As A Personal Representative On average, the deceased will name the personal representative in their will. However, if this does not occur the responsibility could be entrusted to the closest living relative or even to a financial institution (like a bank) that will oversee the account. A Colorado judge may appoint a person to the position after a probate examiner reviews the petition and estate information. Being named as a personal representative of an estate is a big deal. The court holds the overseer to all his or her actions in order to protect heirs and creditors of the estate. The duties of a personal representative, executor or administrator in Colorado include the following:
- Notifying Inheritors
- File Will in Probate Court
- Pay Taxes
- Distribute Property
- Open Bank Accounts for Estate
- Settle Debts
All of these tasks and more, including the day-to-day details, rest on the shoulders of an executor. Given the amount of responsibility an administrator holds it is necessary for the personal representative bond to fully cover these actions. Surety Bonds exist to make the probate and estate planning process more secure; though they can be complicated. If you have any questions regarding personal representative bonds please dont hesitate to contact the surety bond experts at Jurisco. A member of their friendly staff will be happy to answer any query that may arise.
In California, Professional Guardians play a vital role in the well-being of the state’s elderly and disabled. Let’s face it: In today’s society, Guardians are essential. And with great power comes great responsibility and, also, a greater risk of system abuse. The and that is why there are checks put in place by the California legal system to those in most need of protecting. A Guardianship Bond is one of those checks. Mandatory licensing by the office of the California Consumer Affairs is another (see here for more info: http://www.fiduciary.ca.gov/). The Guardianship bond is required when a person may be deemed incapacitated by the court by either infirmity or age. In these cases, the probate court may appoint a guardian to handle the incapacitated person’s (ward) financial and physical affairs. Requiring a guardianship bond ensures the person is not mistreated or taken advantage of financially.
It has been many years since the tradition structure of family living dissipated. Rarely now do you find three generations of a family living together and and rarely do parents have the time or resources to care for the permanently disabled. Things that used to be common are now the exception. And families must trust strangers to care for grampa. A story I recently read on SantaCruz.com by author Georgia Perry got me thinking about this. (See story here: http://www.santacruz.com/2012/07/31/guardianship_case_highlights_plight_of_elderly/)
Loved ones shouldn’t be frightened by the occasional bad story. Rather, they should be careful. Because, by and large, California’s Professional Guardians are a wonderful and trustworthy group. And they care they provide can make you life, and the life of a disabled loved one, so much better.
If you are looking for a professional guardian or are already a Fiduciary and are interested in learning more about the requirements for a Guardianship Bond in California, please contact the bond experts at Jurisco and their helpful staff will provide you with all the information you require.
A Personal Representative Bond in California is required to protect the interest of the deceased’s estate, its heirs and those parties who are owed money. The responsibility of a personal representative (commonly referred to as an administrator or executor in California) is taken seriously by the courts. Courts mandate the surety bond as a form of protection for all parties. While the surety bond protects the heirs and creditors of the estate, it is also a protection for the personal representative to ensure she/he fulfills their duties responsibly.
Being Appointed As A Personal Representative
On average, the deceased will name the personal representative in their will. However, if this does not occur the responsibility could be entrusted to the closest living relative or even to a financial institution (like a bank) that will oversee the account. A California judge may appoint a person to the position after a probate examiner reviews the petition and estate information.
Being named as a personal representative of an estate is a big deal. The court holds the overseer to all his or her actions in order to protect heirs and creditors of the estate.
The duties of a personal representative, executor or administrator in California include the following:
- Notifying Inheritors
- File Will in Probate Court
- Pay Taxes
- Distribute Property
- Open Bank Accounts for Estate
- Settle Debts
All of these tasks and more, including the day-to-day details, rest on the shoulders of an executor. Given the amount of responsibility an administrator holds it is necessary for the personal representative bond to fully cover these actions.
Waiving Administrator Bond Requirements
There are situations where the California requirement for a personal representative bond can be waived. For instance, the deceased could explicitly state there is no need for a bond. Another scenario is when all the heirs of an estate jointly decide to waive the mandate.
Even if the will and the heirs waive the bond requirement a California judge may still mandate the administrator use a probate bond to protect the estate. This is normally the case when the executor lives outside of the state.
Executor Bond Cost
California executor bond statute explains how a personal representative bond amount is determined:
8482. (a) The court in its discretion may fix the amount of the bond, but the amount of the bond shall be not more than the sum of:
(1) The estimated value of the personal property.
(2) The probable annual gross income of the estate.
(3) If independent administration is granted as to real property, the estimated value of the decedent’s interest in the real property.
(b) Notwithstanding subdivision (a), if the bond is given by an admitted surety insurer, the court may establish a fixed minimum amount for the bond, based on the minimum premium required by the admitted surety insurer.
(c) If the bond is given by personal sureties, the amount of the bond shall be twice the amount fixed by the court under subdivision (a).
(d) Before confirming a sale of real property the court shall require such additional bond as may be proper, not exceeding the maximum requirements of this section, treating the expected proceeds of the sale as personal property.
The executor bond lasts as long as it takes to formally settle an estate. Sometimes this can be achieved in as little as eight months while other estates take years to settle. The longevity of the personal representative bond will impact the cost of the surety. Make sure to discuss this point with your Jurisco representative when you contact them about personal representative bonds
Probate bonds may vary state-to-state making it difficult to know what the state mandates and requires. To help make fiduciary bonds more understandable, Jurisco is putting together series of blog posts related to court bonds and state requirements. Today we delve into Executor Bond Illinois.
What is an Executor Bond and who needs it?
Executors, persons/company in charge of an estate or inheritance, are required to obtain an Executor Bond Illinois to financially cover their actions. This surety bond protects the beneficiaries and estate against any wrongdoing by an executor should they fail to manage the assets properly. An executor bond would cover beneficiaries, for example, if their inheritance is stolen; however, it also holds the executor responsible for paying the bond back.
Why do Illinois Courts make this requirement?
An Executor is in charge of the financial being of an estate including paying taxes, settling debts, contacting beneficiaries and properly handing real estate. The Illinois Executor may also pay themself for completing these services. Since the estate’s quality rest in the hands of the Executor, the state must ensure a proper job and provide legal recourse otherwise.
Does Illinois require a fiduciary bond if the executor lives out of state?
The state of Illinois does not mandate the residence of an executor. He/she may live in any state, but must follow the same guidelines. A person living in Alabama, for example, would still need to obtain a probate bond if the estate is in Illinois.
Is the probate bond based on the value of the estate?
The value of the estate influences the cost of an executor bond as well as its necessity. Illinois probate courts may not require a surety bond if the estate is valued less than $100,000.
Are multiple bonds required if there’s more than one executor?
There may be multiple executors of an estate, called “co-executors”. If there turns out to be more than one executor, however, only one “co-executor bond” will be required for the estate unless the court orders otherwise. Alternatively, if no one is found willing to serve, the public administrator in the respected Illinois county would handle the estate.
What happens if the Executor fails to obtain a surety bond?
When a court mandates an executor bond, the bond must be secured before an executor can access the estate and inheritance.
Does the surety bonding company have to be located in Illinois?
The executor may obtain the surety bond from whichever bonding company they see fit. This could mean a surety bonding company in Illinois or a nationwide provider including Jursico.com.
Executors are responsible for taking inventory of and protecting the estate’s assets, trying to find heirs to the estate, paying off any outstanding debt attached to the estate, making sure the taxes are paid and calculated correctly for the estate, and so on and so forth. Some states will also require that executors obtain an Executor Bond in order to protect both the deceased individual and the beneficiaries of this individual from dishonest acts such as embezzlement, fraud, and other acts of this sort.
Many Florida courts require a personal representative bond as a way to protect an estate, beneficiaries and creditors from a financial loss. A Personal Representative Bonds Protect Assets, also known as an Administrator or Executor, has a duty to the beneficiaries of an estate to pay any debts the estate owes, execute the decedent’s final wishes, and properly distribute funds to beneficiaries.
Courts can bypass this mandate in the event the beneficiaries of the estate issue a statement to the court allowing the Administrator to proceed without the bond or if a provision in the decedent’s last will and testament specifically says a personal representative bond is not necessary. Some Florida jurisdictions do not require the mandate even without these provisions. However, the Court can also enforce the mandate with the aforementioned provisions in place.
A recent case involved a woman who named her only beneficiary the personal representative in the estate. In her last will and testament, she said the beneficiary/personal representative was not required to obtain a personal representative bond. The decision of the court to still mandate the bond left some scratching their heads.
Why mandate the bond if there is only one beneficiary and that person also serves as Executor? Well, there may be only one beneficiary, but there may be more than one person/business owed a debt by the estate. The court has to protect all interested parties, not solely the beneficiary.
The amount of an administrator bond may be 110% or up to 150% of estate, but the value of an estate is not gleaned from the amount of the bond. If you are a beneficiary of an estate, it is best to get information from the Personal Representative directly.
Bad Credit Affect Bonds is having a ripple effect on job employment, housing rates and yes, even surety bond costs. Fiduciary Bonds, similar to probate bond, executor bond and an estate bond, will be affected by bad credit. However, the JURISCO surety bond experts are here to assist applicants who have bad credit or any other problems including bankruptcy.
The role credit scores play are shaping the economy and bonding practices is something we have kept our eye on. Poorly written and unpaid bonds can affect your credit score the same as missing payments on a vehicle. Since a credit score follows everyone around we do not want it to keep them from obtaining the bond they need. Again this is where we rely on our experts to do their best for clients.
It is important to know what is affecting a bond rate whether it’s judicial law or financial standing. You will see blog post about these impacts in the future. Email us any questions about surety bonds and you may see it as our next blog topic.