Probate Bond Renewal: What You Need to Know
Probate bonds are required by courts to ensure that executors, administrators, guardians, and other fiduciaries carry out their duties honestly and diligently. These bonds provide financial protection for the beneficiaries of estates and guardianships, as well as creditors and other interested parties. In order to maintain this protection, probate bonds must be renewed periodically.
Renewing a probate bond is a simple process, but it is important to understand the steps involved and the potential consequences of not renewing on time.
Probate Bond Renewal Process
When it comes to probate bond renewals, the standard practice is to pay an initial premium for the first year and an additional premium on the anniversary date. The renewal invoice is usually sent to the bond principal by the insurance carrier or agency. However, since the advent of the recent Covid crisis, many Probate Courts have experienced delays, causing estates and guardianship cases to be postponed for weeks or months.
To address this issue, we have partnered with insurance carriers that offer great renewal terms, including a full refund of the renewal premium if the bond is discharged within 60 days after the renewal date. While your estate bond is still due on the listed invoice due date, we can help request a deferred due date if you are unable to pay the renewal fee or expect the bond to be terminated and discharged within 60 days, depending on the status and circumstances of the estate.
Potential Consequences of Not Renewing
Probate bonds cannot be cancelled or allowed to lapse by the insurance carrier or the bond principal. Only the court can discharge a bond by court order. However, not renewing a bond can result in a bond principal’s personal credit history being affected if the renewal premium is not paid on time. The unpaid premium may go into collections and appear on the bond principal’s credit report, affecting their credit score and ability to obtain credit in the future. Additionally, not having a valid bond in place can delay the closing of an estate or guardianship, resulting in additional costs and inconvenience.
Conclusion
Renewing a probate bond is a straightforward process, but it is important to do so in a timely manner to avoid any negative consequences. By working with a trusted insurance agency, bond principals can navigate the renewal process and find the best renewal terms available. Don’t let a missed renewal put your personal credit history and estate or guardianship in jeopardy.
