Missouri Conservator Bond: A Comprehensive Guide

This guide provides information for insurance agents to help their customers obtain a Missouri 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 Missouri
• Purpose: To ensure the protectee receives compensation for financial harm if the conservator mismanages their estate
• Who Regulates Conservator Bonds in Missouri: The circuit court with jurisdiction over where the protectee resides or has property

Background

Missouri Statute 475.079 requires all conservators to be appointed by a court before assuming their fiduciary duties. The Missouri legislature enacted the appointment requirement to ensure conservators act in the protectee’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 Missouri Conservator Bond?

Missouri requires most conservators to purchase a surety bond as a prerequisite to being appointed as a fiduciary. The bond ensures that the protectee will receive compensation for financial harm if the conservator fails to abide by the regulations outlined in Missouri Statute 475.100. Specifically, the bond protects the estate if the conservator fails to adhere to all court orders or mismanages the protectee’s assets.

For example, if a conservator uses money from the protectee’s bank account to pay for unauthorized expenses or mixes the estate’s funds with their own, the protectee 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 protectee if the conservator does not fulfill their fiduciary duties.

How Can an Insurance Agent Obtain a Missouri Conservator Bond?

BondExchange makes obtaining a Missouri 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.

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How is the Bond Amount Determined?

Missouri Compiled Law 700.5410 grants the court the authority to set the required bond amount on a case-by-case basis. When determining the required amount, the court will consider factors such as the estate’s total value as well as the income it is expected to generate during the conservatorship. The bond amount may be reduced by the value of the estate’s assets deposited with a depository institution that prevents its unauthorized disposition. The court may increase or reduce the required amount as it sees fit.

What are the Underwriting Requirements for the Missouri Conservator Bond?

Most surety companies will examine the following factors when determining eligibility for the Missouri 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

How Much Does the Missouri 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.  Missouri Statute 475.100 allows for the conservator to pay the cost of the bond at the expense of the protectee’s estate.

The following table illustrates the pricing structure for the Missouri Conservator bond:

$1,500,000 Conservator Bond Cost

Who is Required to Purchase the Bond?

Missouri requires most conservators to purchase a surety bond as a prerequisite to becoming a court-appointed fiduciary. To paraphrase Missouri Statute 475.010, a “conservator” is an individual or organization appointed as a fiduciary to have care and custody over a protectee’s estate. Likewise, a “protectee” is a minor or disabled person for whom a conservator has been appointed. Additionally, a “minor” is a person under the age of 18, and a “disabled person” is an adult who has been judged by a court to be physically, mentally, or cognitively unable to manage their financial resources.

Conservators are not required to purchase a surety bond if:

• They are a bank or trust company authorized to act as a fiduciary in Missouri
• The court determines that a bond is not necessary

The court may at any time require an exempt conservator to purchase a bond.

How do Missouri Conservators Become Appointed as Fiduciaries?

Conservators in Missouri must navigate several steps to become appointed as fiduciaries. Below are the general guidelines, but appointees should refer to the appointment statutes or the Missouri Court’s website for details on the process.

Conservators of a Minor’s Estate

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 – Meet the Qualifications

Persons are ineligible for appointment as a conservator, unless directly related to the minor, if they are:

• • An owner, operator, or employee of a care facility licensed by the Department of Mental Health or the Department of Social Services where the minor resides
  • A full-time judge, clerk, deputy clerk, or division clerk of any court in Missouri
  • A minor, disabled or incapacitated person, or a habitual drunkard
  • A previously appointed guardian or conservator whose letters were revoked within the last two years

Step 3 – Determine Priority

Priority to serve as a conservator over a minor’s estate is granted in the following order:

• • The parents of the minor
  • A person nominated by the minor if the minor is at least 14 years of age
  • Any person nominated by the will of the minor’s parents

The court will appoint the conservator best suited for the minor and may choose to appoint a person with lower priority or without priority.

Step 4 – File a Petition for Appointment

Persons seeking conservatorship over a minor must file a petition for appointment with the probate division of the circuit court with jurisdiction over where the minor resides or owns property. Petitioners can obtain the necessary forms online here or from the court, and must ensure they include the following information:

• • General statement and evaluation of the minor’s condition and estate
  • The reasoning for why a conservatorship is necessary
  • Any additional information requested by the court

Step 5 – Attend a Hearing

Conservators must attend a hearing conducted by the court and present evidence as to why the minor is in need of conservatorship. The court will examine the evidence presented by the conservator as well as that presented by the minor 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. In certain cases, the court may choose to appoint the conservator for the minor without a 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).

Conservators of a Disabled Person’s Estate

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 – Meet the Qualifications

Persons are ineligible for appointment as a conservator, unless directly related to the minor, if they are:

• • An owner, operator, or employee of a care facility licensed by the Department of Mental Health or the Department of Social Services where the disabled adult resides
  • A full-time judge, clerk, deputy clerk, or division clerk of any court in Missouri
  • A minor, disabled or incapacitated person, or a habitual drunkard
  • A previously appointed guardian or conservator whose letters were revoked within the last two years

Step 3 – Determine Priority

Priority to serve as a conservator over a disabled adult’s estate is granted in the following order:

• • The nominee of the disabled person if the person has sufficient mental capacity to make and communicate a reasonable choice
  • The nominee of the disabled person made under a durable power of attorney if the power of attorney went into effect before the inception of the person’s disability
  • The spouse, parents, adult children, adult siblings, or other adult relatives of the disabled person
  • Any other eligible person or organization nominated by the will of a relative or spouse of the disabled person

The court will appoint the conservator best suited for the disabled individual and may choose to appoint a person with lower priority or without priority.

Step 4 – File a Petition for Appointment

Persons seeking conservatorship over a disabled person must file a petition for appointment with the probate division of the circuit court with jurisdiction over where the individual 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 disabled person and petitioner
  • General statement and evaluation of the individual’s condition and estate
  • The reasoning for why a conservatorship is necessary
  • Any additional information requested by the court

Step 5 – Attend a Hearing

Conservators must attend a hearing conducted by the court and present evidence as to why the disabled person is in need of conservatorship. The court will examine the evidence presented by the conservator as well as that presented by the disabled person 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 Missouri Conservators File Their Bonds?

Conservators should file their completed bond forms, including the power of attorney, to the probate division of the circuit court with jurisdiction over where the protectee 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
• Legal name, county, and estate number of the protectee’s estate
• Surety company’s legal name
• Bond amount
• Type of fiduciary relationship
• Date the bond is signed and goes into effect

What can Missouri Conservators do to Avoid Claims Made Against Their Bonds?

To avoid claims against their bonds, conservators in Missouri must ensure that they:

• Perform all of their fiduciary duties
• Obey all court orders
• Do not mismanage the estate’s assets
• Obtain court approval before using any of the estate’s funds