Guardianship bonds fall into the category of court bonds. Courts often step in to appoint guardians when a person is mentally or physically incapacitated, elderly, or a minor. When a court appoints an individual to take guardianship of another person, they often require that the individual who is being appointed as guardian secure a guardianship bond. These guardianship bonds, which are also known as conservator bonds, are most commonly required when the conservator will be in charge of the ward’s finances. Why? It’s an easy and effective way of protecting the interests of the person who is the subject of the guardianship ruling. Some people are surprised to learn that guardianship bonds may be required even if you voluntarily become the guardian of a vulnerable person; again this is to protect the ward from any potential dishonest behavior of the guardian.
How Do Guardianship Bonds Protect the Ward’s Interests?
The surety bond provides a form of financial umbrella. If the guardian fails to act in the best interests of the ward a claim can be made against the bond to reimburse any financial losses. It’s for this reason that surety bonds are often mistaken for a form of insurance. As a guardian, you should be aware that surety bonds are not insurance. If you’re appointed as a guardian and required to purchase a surety bond it’s essential that you’re aware of your financial responsibilities, not just to your ward, but also to the surety bond company. If a claim is made against your surety bond, the surety will pay the claim if it’s deemed valid. However, unlike insurance, you will then be required to reimburse the surety bond for any expenses paid on your behalf. You will not have to worry about this if you honestly and fairly care for the ward and their finances!
Securing a Guardianship Bond
A guardianship bond is a contract between three parties: the surety (underwriter), the obligee (the court), and the principle (the guardian). To secure a bond and fulfill the court’s requirements you’ll need to fill out an application and provide any additional requested documentation. The bonding service will calculate the premium and issue your quote. Once the premium is paid in full the bond will be issued.