Important Considerations

Insolvent estates

Before accepting the role of executor you may want to satisfy yourself that the estate is solvent to the extent that you will not be left out of pocket. The problem with insolvent estates, of course, is that there may be no money to pay for funeral expenses and then executor’s expenses once secured debts have been settled. If the value of secured loans looks like they may exceed the total assets then the estate is not only insolvent but any expenditure by the executor will not be reimbursed. Secured loans can for instance include mortgages, home loans, car loans and business loans.
If all of the deceased’s assets were owned jointly as Joint Tenants then they will pass to the surviving partner and these assets will not form part of the estate. It could technically be insolvent because there are no funds for the executor to handle. Ideally the executor will persuade the surviving partner to settle the debts. Alternatively a creditor or the Personal Representative can apply for an Insolvency Administration Order. This places the estate in the hands of an official receiver who can recover money from the deceased’s share of the joint property. The services of a solicitor are recommended in this scenario.

Executor responsibilities

Executors have possession of the estate’s assets from the moment they accept the position, and are responsible for their security until probate is granted and they are able to realise, collect and distribute assets. This means that you must take reasonable care of these assets. For instance, if a property is unoccupied you should make sure that it is kept securely locked and there is no fire risk. You should be certain to inform the insurance company quickly as the property may not be insured under these circumstances. Insurance companies may insist that the water tanks are emptied and that you turn off the gas and electricity during winter. You should be careful to note any specific clauses in the policy.
As an executor you may be tempted not to inform the bank of the death when an account is jointly held so that the surviving spouse retains access. Remember that you will be personally liable if anything goes wrong. Similarly, make sure that any benefit claims and pension payments are stopped as soon as possible. Benefit overpayments are no longer preferred debts and if there is not enough in the estate to repay them you could be personally liable.

Identity theft

The recently deceased are a favoured target for identity theft fraudsters. A name, address and date of birth can be enough to arrange credit cards, loans and other services in someone else’s name. Exact figures are not known but some people think as many as one in twenty deceased people are affected. There are some precautions you can take to minimise the risk:
Don’t publish the deceased’s age, date of birth, address or maiden name, for instance in obituaries
Unwanted documents should be shredded or burnt. Wanted documents should be removed from empty houses
Inform any financial institutions and Government departments the deceased dealt with promptly
Check with the Post Office that a mail redirection has not been put in place by someone else (contact Royal Mail Customer Care on 08457 740 740 ), and request a redirection yourself if the property is empty
Register the death with these services to reduce promotional mail
When instructing an estate agent to advertise a property, request that the term “vacant possession” is not used. Check empty houses regularly and remove mail
If you suspect that identity fraud may have taken place you should contact the police and you may want to consider registering with CIFAS (cost £20) which may reduce the possibility of further fraud occurring.