From Court Hearing to Guardianship Commision - The Fiduciary Bond
A fiduciary bond is court-ordered protection, a form of insurance. It is not protection for the guardian but it is protection for the person who needs a guardian. By issuing a bond the bonding agency agrees to repay the ward any money that might be lost because of the guardian’s actions or mistakes. Fiduciary bonds are also called “surety bonds” but in general they are usually just called “bonds.”
Not every guardian must get bonded. Guardians for Personal Needs usually do not have to get a bond, but most Guardians for Property Management do, unless the ward’s assets are very limited and the judge decides that a bond is not needed. The Order and Judgment is the document that states the judge’s decision about whether or not you must get a bond and, if so, for how much.
|NOTE: If you are required to get a bond, you must get one as soon as possible because you cannot get your Guardianship Commission without it.|
How do I get a bond?
Bonds are issued by a bonding agency. You must call a bonding agency as soon as possible after you have received the signed Order and Judgment. Check with the bonding agency to find out if you can submit your application by mail, phone or fax. Remember, when you contact the bonding agency you must have the Index Number available. When you apply for a bond you must show the agency a copy of the Order and Judgment, since it is the document that states what the amount is of the bond. (View a list of bonding agencies).
Whether the bonding agency permits you to be bonded depends on your> financial situation. The bonding agency wants to know whether you are financially responsible - it will check your credit rating, your income and resources, whether or not you have any debt, and whether you have ever filed for bankruptcy. If the bonding agency decides for any reason that you are not a good financial risk, it will not bond you.
|NOTE: If you cannot get a bond because the bonding agency has refused to give you one, you should immediately notify the judge. Judges sometimes will reduce the bond so that the bonding agency will accept you and sometimes the judge will waive the bond requirement altogether. However, in some cases the judge will appoint someone else as Guardian for Property Management.|
How much does a bond cost?
The amount you have to pay to get a bond and maintain it, the annual premium, is based on a percentage of the value of your ward’s property and income. The amount of the bond is set by the judge; the amount of the premium is set by the bonding agency. Annual premiums must be paid out of your ward’s assets.
If you paid the initial premium for establishing the bond out of your own funds, you can ask for reimbursement when you submit your Annual Report. Make sure that you keep receipts!
|NOTE: If the value of your ward’s assets changes after you have been bonded, you must tell the judge who will order you to obtain another bond to reflect the change.|
Where do I file the bond?
After you have received the bond from the bonding agency, you must file it together with the signed and notarized Oath and Designation with the county clerk’s office. In some counties the bond must first be reviewed and approved by the guardianship office, before it can be filed with the county clerk. Check with the county clerk in your county to see what the local practice is there. Remember to keep a copy of the bond and the Oath and Designation for your records.
|NOTE: You may get your Guardianship Commission from the county clerk on the same day that you file the bond and Oath and Designation.|