Mississippi Executor Bond: A Comprehensive Guide
At a Glance:
- Average Cost: Calculated based on a tiered structure
- Bond Amount: Determined on a case-by-case basis (more on this later)
- Who Needs it: Most executors and administrators handling the estates of deceased Mississippi residents or property owners
- Purpose: To ensure estate beneficiaries and creditors receive compensation if the executor/administrator mishandles the estate’s assets
- Who Regulates Executors and Administrators in Mississippi: The chancery court of the county with jurisdiction over where the deceased individual resided or had property
Mississippi Statute 91-7-1 requires all executors and administrators of estates to be appointed by a court and swear an oath before assuming their fiduciary duties. The Mississippi legislature enacted the appointment requirement to ensure that executors and administrators do not mismanage the estate’s assets. To provide financial security for the enforcement of this requirement, the court may require the executor or administrator to purchase a probate surety bond to be eligible for appointment.
What is the Purpose of the Mississippi Executor Bond?
Mississippi requires executors and administrators to purchase a surety bond as a prerequisite to being appointed as a fiduciary over an estate’s assets. The bond ensures that the estate’s beneficiaries and creditors will receive compensation for financial harm if the executor/administrator fails to abide by the regulations outlined in Mississippi Statutes 91-7-41 and 91-7-67. Specifically, the bond protects beneficiaries and creditors if the executor/administrator commits any acts of fraud or mismanages the estate’s assets. In short, the bond is a type of insurance that protects the estate’s beneficiaries and creditors if the executor or administrator violates their fiduciary duties.
How Can an Insurance Agent Obtain a Mississippi Executor Surety Bond?
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How is the Bond Amount Determined for the Mississippi Executor Bond?
Mississippi Statute 91-7-41 dictates that executors and administrators with will annexed must purchase a bond in an amount equal to the full value of the estate. Additionally, Mississippi Statute 91-7-67 states that administrators of all other estate types must purchase a bond in an amount equal to the value of the estate’s personal property. However, the court may increase the required bond amount if necessary or reduce it if the deceased individual died intestate and all estate beneficiaries agree.
What are the Underwriting Requirements for the Mississippi Executor Bond?
Most surety companies will examine the following factors when determining eligibility for the Mississippi Executor bond:
- Fiduciary’s credit history (not considered for bonds with limits less than $25,000)
- Whether or not the estate has an attorney (not considered for bonds with limits less than $25,000)
- How long the fiduciary appointment is for
- Whether or not the executor/administrator is replacing a prior fiduciary
- If the fiduciary has ever committed a felony
- If there are disputes among the estate’s beneficiaries
- Whether or not there is any ongoing business in the estate
- If the bond is being required by a creditor
How Much Does the Mississippi Executor Bond Cost?
Surety companies typically determine the premium rate for executor bonds based on a tiered structure. As a result, larger bond amounts will be charged a lower premium rate than smaller bonds.
The following table illustrates the pricing structure for the Mississippi Executor bond:
$1,500,000 Executor Bond Cost
|Bond Amount||Premium Rate||Total Bond Cost|
|Total cost of $4,715|
Who is Required to Purchase the Mississippi Executor Bond?
Mississippi requires executors and administrators to purchase a surety bond as a prerequisite to obtaining a fiduciary appointment. An executor is a person nominated in the deceased individual’s will to administer their estate. Likewise, an administrator is responsible for administering the estate of a deceased individual who either did not nominate them in their will or died without one.
Executors and administrators are not required to purchase a bond if:
- The will explicitly waives the bond requirement
- All estate beneficiaries agree to waive the requirement
- The executor/administrator is the estate’s sole heir
The court may at any time require an exempt executor/administrator to purchase a bond. Additionally, a creditor of the estate may petition the court to require an exempt executor or administrator to be bonded.
How do Executors and Administrators Become Appointed in Mississippi?
Executors and administrators in Mississippi must navigate several steps to become court-appointed fiduciaries. Below are the general guidelines, but applicants should refer to Mississippi’s probate statutes for details on the process.
Step 1 – Meet the Qualifications
Executors and administrators are ineligible for appointment if they:
- Are under the age of 18
- Are deemed to be of unsound mind by the court
- Have been convicted of a felony
Step 2 – Determine Priority
Priority to serve as an executor or administrator shall be granted in the following order:
- Persons nominated in the will
- The surviving spouse
- Any other relative, with priority to persons entitled to some or all of the estate’s assets
- Trust companies or national banks
- If the deceased individual has been dead for at least 30 days, any creditor or qualified person
Step 3 – Hire an Attorney
Although not explicitly required, it is highly recommended that executors and administrators hire an attorney to assist with the probate process.
Step 4 – Contact the Court
Executors and administrators must contact the chancery court of the county with jurisdiction over the deceased individual’s estate. A representative of the court will walk the executor/administrator through the appointment process, provide them with all required forms, and answer any questions they may have.
Step 5 – Purchase a Surety Bond
Unless otherwise exempt, executors and administrators must purchase and maintain a surety bond (limits outlined above).
How do Mississippi Executors and Administrators File Their Bonds?
Executors and administrators should submit their completed bond forms, including the power of attorney, to the county court with jurisdiction over the estate.
The surety bond requires signatures from the company that issues the bond and the executor/administrator. The surety company should include the following information on the bond form:
- Court where the bond is to be filed
- Legal name of the entity/individual(s) buying the bond
- Surety company’s name
- Bond amount
- Date the bond is signed
- Name of the deceased individual
- Date the fiduciary appointment was made
What can Mississippi Executors and Administrators do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, executors and administrators in Mississippi must ensure that they:
- Do not engage in any acts of fraud
- Do not mismanage the estate’s assets
- Fulfill their fiduciary duties