4th November, 2020
Safeguarding Your Digital Assets
When thinking about your estate and preparing your Will, it is quite easy to overlook your digital assets. However, failing to make adequate provision for these assets can cause numerous problems for your executors when the time arises to administer your estate.
The Extent of the Problem
A recent study by Direct Line Life Insurance revealed that, in the last 12 months, probate specialists struggled to find all of the financial accounts tied to an estate in 28% of cases, due to the shift towards online banking and electronic record keeping. Any online assets or accounts which your executors do not know how to access (and which they may not even know the existence of) are at risk of becoming irretrievably lost once you pass away.
To take the popular cryptocurrency Bitcoin as an example, it is estimated that somewhere between 3 and 4 million coins have been irretrievably lost (i.e. the private key required to access these coins cannot be located) and the market value of these locked coins would be in excess of £20bn based on current prices.
Even if you do not believe that you hold digital assets which have a monetary value, information held within emails may still be important to your executors. You may also have photos or videos stored digitally which are of great sentimental value to your family and friends and which you do not wish to see lost or inadvertently deleted.
Ensuring Digital Assets Are Accounted For
It is highly recommended to securely keep a physical copy of all of the details required to access your digital resources and to ensure that this record is kept up to date. Different online platforms will have different policies with regards to what can happen to your digital assets in the event of your death and it is important that you familiarise yourself with these policies to ensure that your executors can comply with this.
Also, it is important to check the Terms of Service for any social media sites that you use, as these will often contain provisions for who could access your account in the event that you pass away. Facebook, for example, allow you to appoint a “legacy contact” to manage your profile after you pass away or allow you to choose to have your page memorialised instead.
By taking steps now to ensure that your digital assets are accounted for and that the information required to access them is in a format where it will be available to your executors when you pass away, you can mitigate the risk of your online assets becoming lost in an information vacuum.
Wills, Trusts & Tax
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