When an individual cannot manage their financial affairs, a Conservator might be appointed.
A Conservator is a court-appointed fiduciary who takes care of real estate, manages bank accounts, and handles investments for an individual who can no longer manage those on his/her own.
To ensure a Conservator follows through with their duties, the court might require the Conservator to get a Conservatorship Bond.
What is a Conservatorship Bond?
A Conservatorship Bond is a type of court bond that ensures a court-appointed individual will perform and fulfill their obligations.
A note on Guardians and Conservators:
Conservatorship Bonds are sometimes called Guardianship Bonds. In our experience, Conservators handle monetary matters for an individual, while Guardians handle the day-to-day care of an individual.
Some states, however, make no recognition of this difference and the terms are used interchangeably.
Who Needs a Conservatorship Bond?
You might need a Conservatorship Bond if:
- You are selected as a guardian/conversator of a minor, elderly, or disabled person
- You are selected as a guardian/conservator of any of the above’s finances or estate
If you require a bond, the court will let you know. In some cases, a judge might deem a bond unnecessary if the person needing care has limited assets.
For more details on who needs a Conservatorship Bond, view the complete Conservatorship and Guardianship State Statutory Requirements Chart.
How Does a Conservator Bond Work?
The Purpose of Your Bond
The purpose of your bond is to protect the ward or incapacitated individual whom you are serving. The bond protects against theft, fraud, misrepresentation, or improper handling of assets.
By getting a bond, you are promising that you will properly perform your duties and obligations according to law. If someone feels you are not fulfilling your duties, they can make a claim against your bond.
If A Claim Is Made Against Your Bond
A bond claim is a complaint saying that you have not fulfilled the duties of your appointment as a Guardian or Conservator. Usually this means someone feels you are not caring for the well-being of the ward according to law. Anyone can make a claim against your bond, but the claim cannot be for more than the total amount of the bond. Someone might make a claim against your bond for any of the following reasons:
- Misuse of the ward’s money
- Theft, fraud, misrepresentation, or improper handling of the ward’s assets
- Not fulfilling the ward’s wishes
Claims can only be made against your bond during the time your bond is active.
If a claim is filed against your bond, the surety company expects you to take care of the claim. If you fail to do this, the Surety will usually start an investigation to determine the claim’s validity. They will reach out to both you and the claimant.
One of two things will happen:
- The surety company will investigate the claim and determine it to be invalid. No further action will be taken with the investigation, but you might be liable for any costs the Surety incurred during the investigation process.
- The surety company will investigate the claim and determine it to be valid.
If the surety company finds the claim to be valid, they will remind you of your obligations under the bond and ask you to settle the claim. Sometimes this involves compensating the protected person for any financial loss or hardship they suffered.
If you fulfill the claim, the claim process ends.
If you fail to fulfill the claim, the surety company will step in and pay the claim for you. The surety company will then come to you for reimbursement of the settlement and any legal costs associated with it.
This is one way a surety bond differs from an insurance policy. While an insurance company does not expect to be paid back for a claim, a surety company does. You are responsible for cooperating with the surety company during the entire claim process. You are also responsible for paying back the surety company every penny they pay out on a claim, including all costs associated with the claim.
How Much do Conservatorship Bonds Cost?
The Conservatorship Bond amount is determined by a judge and based on the worth of the financials or estate of the person you are caring for.
You won't have to pay the entire bond amount to get bonded, but you will have to pay an annual premium for the bond, until the bond is released from the court.
The price you pay for the bond will be a small percentage of the total bond amount.
For example, if the court requires you to provide a bond in the amount of $100,000, you will not have to pay $100,000. Depending on your approval with the surety company, you might only need to pay around $400 - $500 for your bond.
The best way to see what you would pay for a Conservatorship Bond is to get a free quote:
Where can I get a Conservatorship Bond?
Your best option for obtaining a Conservatorship Bond is through a surety bond company that has a large network of carriers.
At Surety Solutions, we shop your bond application with over 30 different carriers. This means we can get you the best price for your bond.
Is Being a Conservator Worth it?
Being a Conservator is an important job; it isn’t for the faint of heart or those that are not dedicated to the job. As a Conservator, you will have many responsibilities, all which are court-mandated and regulated.
You will have to give regular reports to a judge to prove you are fulfilling your duties. And if someone feels as though you are not fulfilling your duties to the best of your ability, a claim can be made against your bond, starting a long and arduous court process.
On the other hand, though, being a Conservator enables you to care for someone who needs care or assistance in managing their financials or estate, a hard, but rewarding experience.
5 Types of Court Bonds and What They Do