North Dakota Conservator Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a North Dakota Conservator bond.
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 conservators appointed as fiduciaries in North Dakota
- Purpose: To ensure the protected person receives compensation for financial harm if the conservator mismanages their estate
- Who Regulates Conservator Bonds in North Dakota: The district court in the county where the protected person resides or has property
North Dakota Code 30.1-29-01 requires all conservators to be appointed by a court before assuming their fiduciary duties. The North Dakota legislature enacted the appointment requirement to ensure conservators act in the protected person’s best interests when managing their estate. To provide financial security for the enforcement of this requirement, most conservators must purchase and maintain a probate surety bond before becoming appointed as a fiduciary.
What is the Purpose of the North Dakota Conservator Bond?
North Dakota requires most conservators to purchase a surety bond as a prerequisite to being appointed as a fiduciary over an estate. The bond ensures that the protected person will receive compensation for financial harm if the conservator fails to abide by the regulations outlined in North Dakota Code 30.1-29-11 and 30.1-29-12. Specifically, the bond protects the individual if the conservator fails to adhere to all court orders or mismanages the estate’s assets.
For example, if a conservator uses money from the protected person’s bank account to pay for unauthorized expenses or mixes the estate’s funds with their own, the protected person can file a claim against the conservator’s bond to recoup their losses. In short, the bond is a type of insurance in favor of the protected person if the conservator does not fulfill their fiduciary duties.
How Can an Insurance Agent Obtain a North Dakota Conservator Bond?
BondExchange makes obtaining a North Dakota Conservator bond easy. Simply log-in to your account and use our keyword search to find the “Conservator” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
Not an agent? Then let us pair you with one!
Click the above image to find a BX Agent near you
How is the Bond Amount Determined?
North Dakota Code 30.1-29-11 dictates that the bond amount must equal the aggregate capital value of the estate’s property under the conservator’s control plus the estimated income to be generated by the estate over the next year, including any veterans’ administration benefits received.
The bond amount may be reduced by the value of any assets deposited that cannot be withdrawn without a court order or any land that the conservator can not sell without authorization from the court. Conservators that do not wish to purchase a bond may request to submit another form of collateral instead, such as a pledge of securities or a mortgage of land.
Can the Bond Amount be Adjusted?
Yes, as North Dakota Code 30.1-29-16 allows for any person interested in the welfare of the protected person to petition the court to adjust the required bond amount or require an additional bond if they deem one necessary. The court will have the final say in making changes to the required bond amount.
What are the Underwriting Requirements for the North Dakota Conservator Bond?
Most surety companies will examine the following factors when determining eligibility for the North Dakota Conservator bond:
- Conservator’s credit history
- Whether or not the estate has an attorney
- Whether or not the conservator is a family member
- The conservator’s occupation
- Whether or not the conservator is replacing a prior fiduciary
- If the conservator has ever committed a felony
- Whether or not there is any ongoing business in the estate
- If a creditor is requiring the bond
- If the bond amount is greater than or equal to the estate’s value
How Much Does the North Dakota Conservator Bond Cost?
Surety companies typically determine the premium rate for Conservator bonds based on a tiered structure, so larger bond amounts will be charged a lower premium rate than smaller bonds.
The following table illustrates the pricing structure for the North Dakota Conservator bond:
$1,500,000 Conservator Bond Cost
|Bond Amount||Premium Rate||Total Bond Cost|
|Total cost of $4,715|
Who is Required to Purchase the Bond?
North Dakota requires most conservators to purchase a surety bond as a prerequisite to becoming a court-appointed fiduciary. To paraphrase North Dakota Code 30.1-01-06 and 30.1-26-01, a “conservator” is an individual or organization appointed as a fiduciary to manage the estate of a protected person. Likewise, a “protected person” is a minor or incapacitated person for whom a conservator has been appointed. Additionally, a “minor” is a person under the age of 18, and an “incapacitated person” is an adult who has been judged by a court to be unable to manage their property or take care of themselves.
The court has the authority to waive the surety bond requirement for conservators under good cause and will determine if a bond is necessary on a case-by-case basis.
How do North Dakota Conservators Become Appointed as Fiduciaries?
Conservators in North Dakota must navigate several steps to become appointed as fiduciaries. Below are the general guidelines, but appointees should refer to the appointment statutes or the North Dakota Courts’ website for details on the process.
Step 1 – Hire an Attorney
Although not explicitly required, it is highly recommended that conservators hire an attorney to assist with the conservatorship process.
Step 2 – Determine Priority
Priority to serve as a conservator is granted in the following order:
- The most recent nominee given under the protected person’s durable power of attorney
- Persons already appointed as a fiduciary over the protected person in this state or another, or their nominee
- A person or corporation nominated by the protected person if the protected person is at least 14 years old and has the sufficient mental capacity
- The spouse of the protected person or their nominee
- The adult child of the protected person or their nominee
- A parent of the protected person or their nominee
- A relative of the protected person who has resided with him or her for at least 6 months before the petition is filed
- The nominee of a person or corporation nominated by an entity caring for or paying benefits to the protected person
The court will appoint the conservator best suited for the individual and may choose to appoint a person with lower priority or without priority.
Step 3 – File a Petition for Appointment
Persons seeking conservatorship over a minor or incapacitated adult must file a petition for appointment with the district court with jurisdiction over where the minor/adult resides or owns property. Petitioners can obtain the necessary forms online here or from the court, and must ensure they include the following information:
- Personal information of the incapacitated adult/minor
- Personal information about the person seeking the appointment
- General statement and evaluation of the protected person’s condition and estate, including any compensation, insurance, or pension entitled to the minor/adult
- The reasoning for why a conservatorship is necessary
- Any additional information requested by the court
The person to be protected, the parents or guardian of the person, or any other person interested in the individual’s estate, affairs, or welfare may petition the court to begin protective proceedings over a minor or incapacitated adult. Petitioners must pay an $80 filing fee unless the court grants a fee waiver.
Step 4 – Notify the Appropriate Parties
After submitting the required items to the court, petitioners must have another adult, also known as a server, notify the following parties:
- The incapacitated adult or minor to be protected
- The spouse of the incapacitated adult or minor, if any
- The parents of the incapacitated adult or minor, if they have no spouse
The notice must include a notice of the hearing and a copy of the petition, and petitioners can obtain more information on how to provide notice here. Once complete, petitioners must file a proof of service with the clerk of the district court. If proof of service isn’t filed, the judge or judicial referee may cancel the hearing.
Step 5 – Attend a Hearing
Conservators must attend a hearing conducted by the court and present evidence as to why the minor or incapacitated adult is in need of conservatorship. The court will examine the evidence presented by the conservator as well as that presented by the individual being evaluated (if any) and make a determination as to whether or not conservatorship is necessary.
Any interested person can apply to the court to participate in the hearing. If the court finds a basis for the appointment, it will issue a letter of conservatorship to the petitioner.
Step 6 – Purchase a Surety Bond
Unless otherwise exempt, conservators must purchase and maintain a surety bond (limits outlined above).
How do North Dakota Conservators File Their Bonds?
Conservators should file their completed bond forms, including the power of attorney, to the clerk of the district court of the county where the protected person resides or owns property.
The surety bond requires signatures from the surety company that issues the bond, the applicant, and a notary public. The surety company should include the following information on the bond form:
- Legal name of the entity/individual(s) buying the bond
- Surety company’s legal name and state of incorporation
- Legal name and county of the protected person
- Bond amount
- Type of fiduciary relationship
- Date the bond is signed and goes into effect
- Date the conservator was appointed
What can North Dakota Conservators do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, conservators in North Dakota must ensure that they:
- Perform all of their fiduciary duties
- Obey all court orders
- Do not mismanage the estate’s property