Learn more about executor bonds, and apply today. Absolute Surety offers surety bonds nationwide through a convenient online application system.
What are Executor Bonds?
An executor bond is a type of surety bond often required by probate courts. They are often called “probate bonds” and are a form of fiduciary bond. What an executor bond is called in a particular state depends on the state’s laws governing the disposition of the assets of a person who has died and the settlement of a deceased’s estate.
The responsibilities assigned to executors may include:
Locating the deceased’s assets and heirs
Wrapping up the deceased’s legal affairs
Selling the deceased’s property and accounting for the proceeds
Paying outstanding taxes and debts
Distributing remaining property and assets to beneficiaries named in the will
Who Needs Them?
Some states do not require executor bonds, but a deceased’s will may still require the executor to obtain one. In states that do require it, anyone named in a will as the executor of the estate or appointed by the court to serve in that capacity may need to purchase an executor bond. The exception is when the will specifically states that no executor bond will be required. This may be the case when the deceased’s desire was to relieve the executor of the expense of purchasing a bond and to expedite the settlement of the estate.
The purpose of these bonds is to ensure that the executor performs his or her duties honestly and in accordance with state regulations and the terms of the will. The bond serves as the executor’s pledge to act in an ethical and responsible manner while faithfully carrying out the deceased’s wishes.
How Do They Work?
If the executor is found to have embezzled funds from the estate, commits fraud or any other dishonest act in handling the estate, the deceased’s designated heirs can file a claim against the bond. If the claim is found to be valid, the surety company will make payment up to the full amount of the bond. The surety company will then seek reimbursement of that amount from the executor.
How Much Do They Cost?
The amount of the bond is set by the probate court based on the value of the estate. The bond amount is multiplied by the premium rate established for the executor by the surety company issuing the bond, based largely on the executor’s credit score. The premium rate for an executor with good credit may be as little as 1%. Those with minor credit issues may pay a higher premium rate, and those with significant credit issues may be rejected by the surety company.
Expedite the process of obtaining an executor bond by completing our convenient online application today. We work with an expansive network of providers to offer competitive rates and rapid turnarounds of 24 hours or less.