Surety Bond Professionals is a family-owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all your Illinois probate bond needs.
What Are They?
There are two main types of court bonds in Illinois: appeal bonds and probate bonds. Probate bonds include all bonds required by a probate court to ensure that those charged with fiduciary duties carry out those duties in accordance with applicable laws and the order of the probate court.
While it’s common to think of probate court in the context of wills and estates, Illinois probate courts also assign and oversee guardians managing the assets of minors and custodians doing the same for incapacitated adults. The focus of this article is on probate bonds for individuals named as the executor of a decedent’s estate.
In addition to serving as an executor’s pledge to carry out court-appointed duties in a lawful and ethical manner, an Illinois probate bond provides financial protection for the decedent’s creditors and heirs. Specifically, it ensures that funds will be available for compensating those financially harmed by the actions of an executor.
Who Needs Them?
Other than in the few situations where a waiver may be possible, anyone appointed by an Illinois probate court to serve as executor of a decedent’s estate will need to purchase an Illinois probate bond. It must be in an amount twice the value of the estate, not including the value of any real estate. This required bond amount is also known as the bond’s “penal sum.”
Speak with a Surety Bond Professionals agent today to discuss your bonding needs.
How Do They Work?
The surety bond agreement that provides the basis for an Illinois probate bond is a legally binding contract among three parties:
- The “obligee”—the Illinois probate court requiring the bond.
- The “principal”—the executor required to purchase the bond.
- The “surety”—the surety company underwriting and approving the bond.
The executor’s violation of the terms of the surety bond agreement entitles any injured party to file a claim against the Illinois probate bond. This allows the injured party to seek compensation for the loss up to the bond’s full penal sum. The principal is legally obligated to pay all valid claims, but in practice, the surety will pay a claim on behalf of the principal. In doing so, the surety is extending credit to the principal, creating a debt that must be repaid.
What Do They Cost?
The surety charges each principal a premium based on the risk a claim will be filed and the principal’s ability to repay the surety for claims paid on the principal’s behalf. The primary consideration is the principal’s credit score, but the size of the estate, assets in the estate, involvement of an attorney in managing the estate, and other factors also come into play.
In general, the more creditworthy the principal is, the lower the premium rate will be. A rule of thumb is to expect a premium in the vicinity of $500 per $100,000 in assets held in the estate.
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Our surety bond professionals will get you the Illinois probate bond you need at a competitive rate.