Insurance for Executors

wombat987

I understand that solicitors dealing with probate as executors are covered by their professional indemnity insurance.

I've also found two companies so far that will insure non-legal professionals who are acting as executors.

Apparently, this is a 'new product' but as the insurance industry tends to all jump on new products to the market to compete, does anyone know of any others than the two I've found (Executors Insurance and Arthur J Gallagher)?

Whilst searching, I found other companies as well, but when I called them, the caller answered with 'Arthur Gallagher'. I guess the other companies I found (e.g. Newmarket, LFC, etc) just pass the enguiry on to them to deal with!

My brother and I were named as executors for our late Mother's estate. We have the option of also using the firm that Mum used to draw up her simple and straightforward will as a third executor, but as their costs would be high and it's a (relatively) easy will, they suggested we should do it ourselves.

This insurance is to cover any future claims on the estate which we are not (presently) aware of. Executors are personally liable to settle the deceased persons debits (out of the estate) and yes, a Section 27 notice should cover ourselves, but just in case...

SeniorSam

If your mother's estate is being passed to family members and they are unaware of any debts and liabilities your mother may have, then it is most unlikely that you would need insurance.

Appointing solicitors or any professional to deal with a simple estate can be very costly as thier charges are based on time taken to deal with the estate and they seem to have a way of 'extending' time

What will the assets of the estate consist of as far as you are aware?

Sam

wombat987

Hi Sam

thanks for your reply.

As executors, we are pretty sure Mum had settled all her liabilities - she didn't like to have anything outstanding (bills, etc). We were interested in finding out more about the insurance, not just from an undisclosed creditor perspective, but also in case there were any other issues that came out of administering her estate.

For example, should one of the beneficiaries seek to delay the distribution, challenge our actions, etc. If the insurance also covered, say legal costs in such an event, it might be worth the premium. It all depends on what insurance cover would offer us versus any potential future events.

The solicitors are quite amenable to discussions about the administration of the estate and have been upfront with their costs. Professional advice would be provided on an hourly rate, or they'd do the whole thing for a percentage. As they said, it should be simple and straightforward to administer the estate, so they recommended we do it ourselves. Nice to find a firm who aren't money grabbing but sensible in their approach!

The estate assets are relatively simple. Mum's house, a separate garage (so two LR titles), money in bank accounts, the house contents and that's about it. Back of a fag packet calculations brings it under 640k, which, with Dad's unused IHT allowance rolled over means it's below the [current] IHT level. We've spoken to the Inland Revenue about the roll over and the relevant forms have been completed and submitted. We don't think IHT will be an issue for us.

Unfortunately, as this type of insurance is 'new' I'm not sure if there will be many people around who have used it, especially to it's full potential benefit. So we are reading through the policy documents to see if it covers events that may happen, otherwise I'd agree, there might not be much point in taking it out.

SeniorSam

You seem to have thought things through very well, but if you are contemplating insurance on the basis of one executor delaying matters, then it is likely that you think this will happen and no insurance policy would cover that,

From what you disclose of assets, this is a simple estate and one you could easily handle yourselves, as the solicitors have already indicated.

The Revenue are always very helpful in these matters and are used to estates being handled by the family, so don't worry too much, you can always call them on any unsure points. Go for it!

Good luck

Sam

troubleinparadise

My mum's estate was relatively complex, including overseas assets, and had 3 beneficiaries, 2 of whom were executors.

It has taken over 4 years to administer (due to overseas matters) and is not completed yet.

I (as one of the 2 executors) have at no time wished for nor felt the need to have insurance - there has not been any issue which might cause the need to arise.

I think professional executors do to indemnify themselves - I have not read of any layperson acting as executor have a need for insurance on this board for instance, and I have not personally felt the need.

I guess it depends on the circumstances.

wombat987

SeniorSam wrote: »

You seem to have thought things through very well, but if you are contemplating insurance on the basis of one executor delaying matters, then it is likely that you think this will happen and no insurance policy would cover that,

Actually, the only potential issue we think might arise is from one of the beneficiaries. As executors, we think Mum chose us two (there are six children in total), because we think and work in a similar way to each other. One other sibling is neutral (but supportive of our task), one sibling thinks they should have got more, the other two, well, who knows which way they might jump!

G6JNS

wombat987 wrote: »

I understand that solicitors dealing with probate as executors are covered by their professional indemnity insurance.

I've also found two companies so far that will insure non-legal professionals who are acting as executors.

Apparently, this is a 'new product' but as the insurance industry tends to all jump on new products to the market to compete, does anyone know of any others than the two I've found (Executors Insurance and Arthur J Gallagher)?

Whilst searching, I found other companies as well, but when I called them, the caller answered with 'Arthur Gallagher'. I guess the other companies I found (e.g. Newmarket, LFC, etc) just pass the enguiry on to them to deal with!

My brother and I were named as executors for our late Mother's estate. We have the option of also using the firm that Mum used to draw up her simple and straightforward will as a third executor, but as their costs would be high and it's a (relatively) easy will, they suggested we should do it ourselves.

This insurance is to cover any future claims on the estate which we are not (presently) aware of. Executors are personally liable to settle the deceased persons debits (out of the estate) and yes, a Section 27 notice should cover ourselves, but just in case...

This seems like of little or no use. Few estates have a problem, the statutory notice covers you, so I would not waste your money.

Mojisola

wombat987 wrote: »

Actually, the only potential issue we think might arise is from one of the beneficiaries. As executors, we think Mum chose us two (there are six children in total), because we think and work in a similar way to each other. One other sibling is neutral (but supportive of our task), one sibling thinks they should have got more, the other two, well, who knows which way they might jump!

One good reason for employing a professional to do the job is if you are going to have siblings making trouble.

The costs would come out of the estate - is it worth mentioning to the others that if anyone starts to make the executors' lives difficult (when all you're doing is following your mother's instructions) that you will ask a solicitor to complete the work and that will reduce everyone's inheritance?

I wouldn't get the solicitor to be the executor - just employ him/her to do the work which you two then sign off.