Probate Bonds in Missouri

Bonds Insurance

Probate bonds are required of individuals who have been appointed by the court to manage the estate of someone else. In that capacity, once you have been appointed, you have a fiduciary responsibility to manage the affairs of that person and their estate with the highest degree of care. The probate bond assures the court you will follow those standards, and the bond will remain in effect until released by the court.

Assuming you have never been asked to provide a probate bond before, let’s cover some quick bond basics in case you’re not familiar.

First of all, understand that a bond is not an insurance policy. An insurance policy is a two party contract, between you and the insurance company. You pay a premium, the insurance company agrees to pay for losses covered in the contract.

The probate bond is different. It’s a three party contract between:

  1. The Principal. That’s you, the individual entrusted with management of the estate.
  2. The Obligee. That’s the estate receiving the benefit of the bond.
  3. The Surety. That’s the insurance company who backs the bond.

So in this case, the bond written by the surety, guarantees the faithful fiduciary performance of the principal, to the obligee.

If the principal fails to perform, the obligee can recover losses from the surety. If the surety pays a claim to the obligee, the bond underwriters from the surety will expect to be reimbursed, or indemnified by the principal for any claims paid.

If you follow that three party relationship, where the first party (the surety), guarantees the performance of a second party (the principal), to a third party (the obligee), you begin to understand that the surety is the party with the greatest risk in the contract. Combine that with the fact that a probate bond can be in effect for a number of years, and you understand why disciplined underwriting is necessary to make sure the principal is qualified to perform his or her fiduciary responsibilities.

For most probate bonds, particularly with smaller estates, the principal (that's you) will be subject to a credit check, and will either qualify or not, based on personal credit history. For larger estates, there may be additional financial underwriting and a joint control requirement over some accounts in the estate. Regardless of the size of the bond, as principal, you will be required to sign an indemnification agreement.

The cost of a probate bond depends on the amount of the bond. For a quote on a probate bond, grab the phone and give us a call. If you’re just doing some internet research at this point, use .05% of the bond amount as a guide and you should be close. That would make a $500 premium on a $100,000 bond.

At Bill White Insurance Agency, we like to write Probate Bonds. Contact us if you need to file a probate bond including Administrator Bond, Executor Bond, or Conservator Bond in Greene County Circuit Court – Probate Court, or other Southwest Missouri courts in counties including Christian, Webster, Lawrence, Stone or Taney.

Types of common probate bonds

Conservator Bond – if you have been appointed to manage the affairs of a person who is living but can’t care for themselves because of mental ability, or because of age, like a minor child under the age of 18.

Executor Bond or Administrator Bond – if you have been appointed to settle the estate of a person who is deceased. You are the executor if the person died with a will and the administrator if there was no will.

Contact us for more information if you don’t see the bond you require listed above. We can also help you with other Court Bonds and Surety Bonds.