Massachusetts Conservator Bond: A Comprehensive Guide
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 Massachusetts
- Purpose: To ensure the protected person receives compensation for financial harm if the conservator mismanages their estate
- Who Regulates Conservator Bonds in Massachusetts: The probate and family court with jurisdiction over where the protected person resides or has property
Background
Massachusetts General Law 5-401 requires all conservators to be appointed by a court before assuming their fiduciary duties. The Massachusetts legislature enacted the appointment requirement to ensure that 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 Massachusetts Conservator Bond?
Massachusetts requires most conservators to purchase a surety bond as a prerequisite to being appointed as a fiduciary over a protected person’s estate. The bond ensures that the protected person and all persons interested in the estate will receive compensation for financial harm if the conservator fails to abide by the regulations outlined in Massachusetts General Law 5-410. Specifically, the bond protects the protected person 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 the conservator’s personal 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 Massachusetts Conservator Bond?
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How is the Bond Amount Determined?
Massachusetts General Law 5-410 dictates that the bond must be in an amount determined by the court and will typically be in an amount equal to the value of the estate’s real property and personal property that is in the conservator’s control. Additionally, Massachusetts General Law 5-415 allows for any person interested in the protected person’s estate to petition the court to adjust the required bond amount or require an additional bond.
What are the Underwriting Requirements for the Massachusetts Conservator Bond?
Most surety companies will examine the following factors when determining eligibility for the Massachusetts 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 Massachusetts 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 Massachusetts Conservator bond:
$1,500,000 Conservator Bond Cost
| Bond Amount | Premium Rate | Total Bond Cost |
|---|---|---|
| First $20,000 | 0.75% | $150 |
| Next $40,000 | 0.60% | $240 |
| Next $140,000 | 0.50% | $700 |
| Next $300,000 | 0.375% | $1,125 |
| Next $1,000,000 | 0.25% | $2,500 |
| Total cost of $4,715 |
Who is Required to Purchase the Bond?
Massachusetts requires most conservators to purchase a surety bond as a prerequisite to becoming a court-appointed fiduciary. To paraphrase Massachusetts General Law 5-101, a “conservator” is a person who is appointed as a fiduciary to manage a protected person’s estate. Likewise, a “protected person” is defined as a minor or incapacitated adult for whom a conservator has been appointed that is deemed incapable of managing their estate.
Conservators are not required to purchase a surety bond, unless explicitly required by the court, if:
- A person with the power to nominate a conservator in a will or other similar writing waives the bond requirement
- The court waives the bonding requirement
How do Massachusetts Conservators Become Appointed as Fiduciaries?
Conservators in Massachusetts must navigate several steps to become appointed as fiduciaries. Below are the general guidelines, but appointees should refer to the appointment statutes or the state’s conservatorship 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:
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- An individual appointed by the protected person under their most recent durable power of attorney
- Persons already appointed as a fiduciary over the protected person in another jurisdiction
- An individual or corporation nominated by the protected person if the protected person is at least 14 years of age and has sufficient mental capacity
- An agent appointed by the protected person under a durable power of attorney
- A parent of the protected person or the parent’s nominee
- Any other person deemed suitable by the court
The court desires to appoint the conservator best suited for the protected person and may choose to appoint a person without priority.
Step 3 – File a Petition for Appointment
Persons seeking a conservatorship over a protected person must file a petition for appointment with the probate and family court with jurisdiction over where the protected person resides or has property. Petitioners can obtain the necessary forms online here or from the court, and must include the following information:
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- Personal information of the minor and their relatives
- Personal information about the person seeking conservatorship
- General statement and evaluation of the person’s estate and property
- The reason for the petition for appointment
- Any additional information requested by the court
In cases involving a disabled adult, the petitioner must also submit a medical certificate with proof showing that the adult has been examined within 30 days of filing the petition.
Step 4 – Notify the Appropriate Parties
After submitting the required items to the court, persons seeking conservatorship must have another adult, known as a server, notify all of the interested parties involved in the case. The notice must be given to all parties listed in the petition for appointment and any other parties determined by the court, and petitioners can request the county sheriff to serve the notice.
Step 5 – Attend a Hearing
Conservators must attend a hearing conducted by the court and present evidence as to why the protected person is in need of conservatorship. The court will examine the evidence presented by the conservator as well as that presented by the protected 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 determine the type of conservatorship necessary and 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 Massachusetts Conservators File Their Bonds?
Conservators should submit their completed bond forms, including the power of attorney, to the probate and family court with jurisdiction over where the protected person resides or has property.
The surety bond requires signatures from the company that issues the bond and the conservator. The surety company should include the following information on the bond form:
- Court division and docket number
- Legal name, address, and phone number of the entity/individual(s) buying the bond
- Surety company’s name, address, and state of incorporation
- Bond amount
- Type of fiduciary relationship
- Date the bond is signed and goes into effect
- Estimated value of the protected person’s real estate and personal property
What can Massachusetts Conservators do to Avoid Claims Made Against Their Bonds?
To avoid claims against their bonds, conservators in Massachusetts must ensure that they:
- Perform all of their fiduciary duties
- Obey all court orders
- Do not mismanage the estate’s assets
