The majority of attorney-drafted wills contain language with which the will maker waives the requirement for the executor to post a probate bond. On the other hand, with a few exceptions, a probate bond is generally required for a personal representative of an estate where there is no will, or where a will does not specifically relieve the executor of this requirement.
When a probate bond is purchased, the bonding company indemnifies against mistakes or misconduct by the personal representative of the estate. So, if your executor neglects to pay one of your creditors or, worse, if he steals assets from your estate, the bonding company will cover that loss and ensure that your creditors are paid and that your heirs receive the inheritances they’re entitled to. This is an advantage, particularly when the abilities of a personal representative are in question.
So, why is it so common for a will to waive the necessity of a probate bond? There are two big drawbacks to requiring a bond: first, a bond can be difficult to get and, second, a bond costs money.
A personal representative has to qualify before being issued a bond, and in order to qualify, he or she has to have a clean credit history and sufficient net worth. Even a potentially capable personal representative might not qualify for a probate bond, and this means someone else – who is able to qualify – must be found to settle the estate.
If the personal representative qualifies for a bond, estate assets are used to pay for the bond. This means that if the personal representative does the job well, there is no need for the bond, and the cost of the bond is ultimately deducted from the inheritances distributed by the estate.
So, should you require that your executor obtain a probate bond? Your estate planning attorney can help you answer that question.