Executors’ Liability Insurance: What it is and why you need it

Taking on the role of Executor of a Estate is often a bigger task than most people realise. Whether you’re a professional Executor or administrating a Estate on behalf of a loved one, you actually take on a weighty legal responsibility and with that unlimited personal liability. 

Executor Liability Insurance exists to protect the Executor from the liabilities and costs that could be incurred when trying to settle someone’s estate. Disputes can happen either by the family, friends and/or a third party. Here are the answers to many of the questions we’re frequently asked about our policies. 

Why would an individual require insurance when executing a will? 

The UK Inheritance Disputes Report, carried out by IBB Law, found that three in four people are likely to experience a will, inheritance, or probate dispute in their lifetime and this is growing. And it also produced some other startling findings, such as disputes most commonly happening between siblings, and one in four complainants claiming that the deceased was coerced. No matter the family, when it comes to inheritance there is always room for dispute. And this can be especially true for those undertaking the role of Executor in a professional capacity. 

If representing clients in the execution and administration of a Estate, you’ll understand how quickly legal costs can rise in the case of a dispute. Our policies ensure you client is protected, should these circumstances arise. 

What scenarios does Executor Liability Insurance cover?

The scenarios covered by any insurance policy will differ by provider, but at Prosperity Insurance our Executor Liability Insurance covers the following eventualities: 

  • Where there is a challenge against the validity of the will by someone who is not named in the will, brought on the following grounds:
    • a) they claim the will is fraudulent or was not properly executed;
    • b) they claim that the deceased either did not have proper mental capacity required to make the will or did not approve the will / have property knowledge of its contents. 
  • A person claiming to be entitled to inherit from the estate is not who they say they are and has fraudulently identified themselves as a beneficiary and been paid.
  • A Claim for financial provision under the Inheritance (Provision for Family and Dependents) Act 1975.
  • A charity that is not insured by this Policy exerts a claim after the estate is distributed.
  • A charitable legacy is challenged by someone who is not named in the will.
  • A claim brought under the principles of proprietary estoppel or on the basis of constructive trust.

What financial cover does Executor Liability Insurance provide? 

Our policies provide up to £50,000 of legal cover. Whilst the estate in question might be valued at more than that, it would be unusual to require cover for the full amount. The aim of the insurance is to cover any fees incurred by defending any dispute raised against the executor. 

What if there’s more than one executor of the will? 

Prosperity Insurance’s policies will provide insurance for up to four executors. 

How long after becoming an Executor can an individual take out Executor Liability Insurance? 

As soon as possible, after a loved one has passed away. Disputes can happen very quickly and sometimes without expectation. That’s why we recommend taking out an insurance policy as soon as your loved one has passed and a legal representative has been instructed.

What’s different about Prosperity Insurance’s policies? 

From your client’s perspective, we offer a fair and competitive policy that provides up to £50,000 of legal cover, covers up to four executors of the estate, and has an option to defer payment for up to six months. 

But where Prosperity Insurance really differs is in the simplicity of our policies, for the benefit of our partnering law firms. Prosperity Insurance is part of a wider business group with Prosperity Law LLP, who have informed our range of insurance products and how we manage them in the most efficient way for firms. 

We pride ourselves on: 

Minimal reporting requirements: You have enough to do, working hard to deliver results for your clients. That’s why we have less reporting requirements than many of our competitors, minimising the bureaucratic burden so that you have more time to do what you do best. 

Competitive premiums: Our premiums are regularly found to be some of the most competitive on the market. Competitive – but high-quality and comprehensive.