Estate distribution insurance - necessary?

Eborexile

I am the administrator for a relative who died without a will.
The probate solicitor is getting ready to make distributions.

It seems I am liable if unknown beneficiaries appear after disbursements have been made.

The solicitor is asking if I want to take out insurance.

Is it worthwhile? And what is the going rate for such insurance?

It seems that we are paying in case the solicitor or his genealogy company didn't do their jobs correctly but I'm inclined to take it as I don't want a cloud hanging over me.

I would welcome views.

SeniorSam

A member of another forum recently answered a similar question in relation to the Executors duties, not the beneficiaries. As such it should be for the executors to effect any insurance that is paid for out of the estate. Perhaps asking that question of the solicitor may help?

This sets out the executor's options: https://www.co-oplegalservices.co.uk...cant-be-found/

Thrugelmir

Eborexile said:

It seems that we are paying in case the solicitor or his genealogy company didn't do their jobs correctly

Did you know the relative well yourself? 

Mojisola

Eborexile said:

I am the administrator for a relative who died without a will.
The probate solicitor is getting ready to make distributions.
It seems I am liable if unknown beneficiaries appear after disbursements have been made.

If the situation is that you didn't know the relative (and their relatives) very well, it could be worth it.

I would have thought that it would be an executor expense so would come out of the estate money rather than you paying for it personally.  Check that with the solicitor who is managing the estate.

Eborexile

Thank you for taking the time to comment. It is much appreciated as all these matters are outside my experience.

I knew the relative well but hadn't seen prior to passing due to distance (the other end of the country) and coronavirus restrictions.
The genealogy company found cousins he hadn't met who are also beneficiaries.

It is correct that the expense will come from the estate and I have now received a quotation for the insurance from the probate solicitor.
I am not expert in these matters and the cost will be effectively shared by multiple beneficiaries.

The (distant) probate solicitor has given quotes for other services which we accepted during lockdown but in hindsight seem to have been on the high side.

I've spoken to two insurance brokers who couldn't help - too specialised for them.

Before spending an inordinate amount of time trying to get "reasonable value" (maybe the quote is already competitive),
I'm trying to get a feel for the price range.

Frankly the whole long drawn out, long distance, process is resting heavily on me and I'm almost ready to just accept and have done with it; as a very close family member has also recently passed.
(but that would go against the grain)
  
Thank you again for taking the time to read my ramblings.

harrybo11

The executor can place a deceased estates notice in The Gazette and local newspaper giving any claimants 2 months and 1 day to come forward and claim. This is recognized to cover the executors/administrators legally in case anyone surfaces at a later date. Google “gazette deceased estates notice” for more information (I’m not allowed to post links yet as I’m still relatively new here!)

Eborexile

harrybo11 said:

The executor can place a deceased estates notice in The Gazette and local newspaper giving any claimants 2 months and 1 day to come forward and claim. This is recognized to cover the executors/administrators legally in case anyone surfaces at a later date. Google “gazette deceased estates notice” for more information (I’m not allowed to post links yet as I’m still relatively new here!)

Thank you for your advice.
The probate solicitor placed the notices in The Gazette and local newspaper.
According to his explanation this covers creditors.

However they are asking whether I want to go ahead with insurance against unknown beneficiaries.

I am trying to get some kind of feeling whether the quote is reasonable or whether I should just accept the price.
Usually I would try to get a couple of quotes but so far I haven't found anyone to give an alternative quote.
(or more specifically two companies I subsequently found have so far failed to quote)  
   
I want to be able to counter any potential complaints from other identified (but never met) beneficiaries as the first price seems quite high. 

Brie

I'm wondering what beneficiaries there could be.  Unless someone was particularly wild with sowing their oats of course.

That said if the genealogy company can't find anyone I would tend to go with that.  And yes insurance should be paid out of the estate prior to distribution but if someone did surface then I would have thought it would be every beneficiary that would share the load rather than just one.  Potentially it may be a price decision - if it's a huge estate with a half dozen beneficiaries and the insurance costs a fiver well go for it merely for peace of mind. Otherwise it might be go around by all the beneficiaries needing to agree prior to payout that and future costs will be borne equally or proportionately to their share.

TELLIT01

How much is being quoted for insurance cover?  Anybody who has watched Heir Hunters will be aware that potential beneficiaries can be spread to the four winds.  Unless the deceased had siblings or children who become the obvious beneficiaries I would be inclined to get the insurance. The cost won't fall to the OP but come out of the estate.  They have nothing much to lose and a lot to gain by protecting themself.

What would be the situation if the estate was distributed, and a valid will appeared at a later date?

Eborexile

Thank you everyone for the advice.
The quote is over £2000 + VAT
I'm told that I would be liable for reclaiming overpaid distributions if another beneficiary surfaced to claim their "share"

If the genealogy company can't find anyone I'm fairly confident that there are no other relatives.
The price seems (to my uninformed mind) quite high but for peace of mind I'm inclined to accept.

I have learnt that probate is a lucrative fee earner for the profession.
However the geography and covid lockdowns meant that I couldn't be on the ground to get things moving.
So I'll not berate myself for not taking a more hands on approach.

Latterly I've been administering my mother's affairs.
Although I'm finding it hard to get motivated, the many steps are proving to be fairly straight forward if a little long winded.

I would advise anyone that leaving a will helps those left behind; and in the case of my relative would have prevented unknown  people from benefitting without any of the stress faced by emotionally closer family.