Choosing and appointing a financially literate executor will give you and your beneficiaries, peace of mind. This must be one of the most important considerations when writing your will. Sometimes what can go wrong will go wrong.
Remember the case in America; the children of the world-renowned violinist Isaac Stern have commenced legal action against their late father's executor. But is the executor able to compensate your beneficiaries in the event your estate suffers loss as a result of negligence or wrongdoing? Sometimes the loss may not even be of their own doing, their staff or agents could have caused it.
Thus, Trust Corporation, which form part of financial services groups, can give the assurance of compensation to their customers. This is not only because they have the financial resources, but also the group's reputation and branding are at stake.
Say, if LMN Trustee is sued for wrongdoing, the reputation of the LMN financial services group is also affected. The LMN group may consist of other types of businesses such as securities, futures, unit trust, asset management, corporate finance, debt capital market, structured products, venture capital and equity financing; it has lots to lose.
If you win a legal suit against LMN Trustee, LMN as the shareholder will have to pay any lawful compensation rather than let LMN Trustee be wound-up. Otherwise, there will be substantial negative impact on LMN's other businesses arising from its marked reputation in the public's eye. From a business perspective, it's an obvious decision for LMN.
Even though there are no concrete statistics, it is believed that most wills written are referred by estate planners, financial planners and life insurance agents to will-writing companies and trust corporations. These planners have an essential role to play because of the influence they have on the decisions made by their clients.
Thus, these estate planners or financial planners must be mindful of their clients' trust and that they must put their clients' interest as the top priority as well as to best protect their clients' wealth.
If you have only one executor and he dies before the administration of the estate is completed, his executor (ie the executor of the said deceased executor) will also be your executor. Meaning, you as the testator may appoint your trusted and good friend 'X', whom you know would be a competent executor and will look after the interests of your beneficiaries.
If 'X' dies without completing the estate administration, 'Y' the executor of the estate of 'X' who may not have any connection with you and your family, will end up being the executor of your estate.
As a result, a person not of your choosing or possibly even a total stranger is then entrusted with the administration of your estate. Thus, appointing a trust corporation eliminates this uncertainty.