Bond of Caution
What is a Bond of Caution?
A Bond of Caution is a specific type of insurance policy which is designed to protect beneficiaries from any mistakes when distributing an estate in Scotland. It provides protection from a person obtaining Confirmation where they are not entitled to do so as well as protects against an executor failing to distribute the estate according to Scots Law.
The Bond is a product for estates where there is no Will i.e. intestate estates.
How it works
When and why might someone need a Bond of Caution?
Technically a Bond of Caution may be needed for all intestate estates unless the entire estate will be inherited by a spouse or civil partner, or the estate value is less than £36,000. In this circumstance the executor of the estate will be appointed by court (this will also apply if the named executor resigns and is replaced by another). Where the executor is appointed by court, obtaining a bond of caution is a legal requirement.
How can Estate Research help
At present, there are only a very small number of insurance companies who are authorised to provide Bonds of Caution. The insurance company will generally only provide a Bond of Caution if a firm of solicitors is appointed to administer and wind up the estate on behalf of the Executor(s).
Estate research been providing Bond of Caution cover to the Scottish legal market for over ten years. We liaise with our brokers to ensure that cover is always available.
If you have any specific questions, you can email our Private Client Manager for Scotland – Andrew Miller at [email protected] for further information.
Costs
The cost of a Bond of Caution depends on the value of the estate being administered. Get in touch for a free quote.
When and why might someone need a Bond of Caution?
Technically a Bond of Caution may be needed for all intestate estates unless the entire estate will be inherited by a spouse or civil partner, or the estate value is less than £36,000. In this circumstance the executor of the estate will be appointed by court (this will also apply if the named executor resigns and is replaced by another). Where the executor is appointed by court, obtaining a bond of caution is a legal requirement.
How can Estate Research help
At present, there are only a very small number of insurance companies who are authorised to provide Bonds of Caution. The insurance company will generally only provide a Bond of Caution if a firm of solicitors is appointed to administer and wind up the estate on behalf of the Executor(s).
Estate research been providing Bond of Caution cover to the Scottish legal market for over ten years. We liaise with our brokers to ensure that cover is always available.
If you have any specific questions, you can email our Private Client Manager for Scotland – Andrew Miller at [email protected] for further information.
Costs
The cost of a Bond of Caution depends on the value of the estate being administered. Get in touch for a free quote.
What if there are missing beneficiaries?
A Bond of Caution doesn’t cover for missing beneficiaries, so genealogy services are required.
If a beneficiary comes forward after distribution, the insurer will pay out under the terms of the Bond of Caution, however there is a risk that the insurer will subsequently seek to recover, from the Executor, monies paid out under the Bond.
If Estate Research have checked the family tree and it is correct and/or located any missing beneficiaries then we will be able to provide you with a quote for Executor Cover (also known as a ‘Comfort Policy’). This protects the heirs and beneficiaries and even in many circumstances, the solicitors from any future possible claims.
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