Probate – Eliminating Foreign Bankruptcy Risks
29th October 2019
When administering an estate, it is prudent for a check to be made to see what the bankruptcy status of a beneficiary is who lives outside of the UK. There could be personal financial implications for the personal representative if they pay out to a beneficiary their share of the inheritance, when it should have been paid to creditors to pay off the beneficiary’s debts. Without a search being made, the personal representative has to rely on the beneficiary to tell the truth and be honest about their financial status. As we all know, unfortunately, not everyone is as trustworthy and as honest as our good selves.
The ability to conduct bankruptcy searches varies from country to country, as well as the cost and timescales to complete such searches. In some countries, searches are not possible at all and there may even be a question mark over the accuracy of the final search result. Certain countries in the Caribbean and the Middle East can often present challenges in carrying out bankruptcy searches.
DUAL Asset Underwriting can provide insurance to eliminate the risk facing the personal representatives and to also protect the estate from future claims. We can provide insurance in the event that an inaccurate bankruptcy search result has been obtained. For example, the search result may be for a different person, but with the same name as the beneficiary, or they may not have had a permanent residential postal address. We can provide insurance because a search cannot be carried out because of the jurisdiction. There may also be occasions where the personal representative does not feel the cost of carrying out bankruptcy searches in certain countries and the length of time it can sometimes take in these countries, is worth carrying the search out, when the accuracy of the search result cannot be guaranteed anyway. DUAL Asset can consider providing insurance in these instances as well, with an insurance policy providing an alternative to carrying out the bankruptcy search, saving time for the estate and eliminating any future risk for those tasked with administering it.
If you have a case that you would like to discuss, please contact Kate Thorp, Manager Executor & Inheritance.