We all use the web daily. The number of online accounts and the value of digital assets are only going to increase. So why do so few people consider what will happen to their digital assets when they die?
The story of Gerald Cotten may ring a bell with you. £100m locked up, with his executors and heirs unable to reach it. Read all about it here.
Think of two categories.
- Financial Information – While not being an asset itself, it leads us to our assets and liabilities such as online bank accounts, savings and investments, PayPal, eBay, and shopping accounts.
- Digital Assets – With value in their own right, whether a character in World of Warcraft, our music downloads or a Kindle library.
You might wonder what the problem is. The law covers all of this either with wills, for those who make them, or the rules on intestacy for those who do not. Why are digital assets any different to paper-based ones? Executors or next of kin just ingather the assets of the deceased, settle their liabilities, pay any inheritance tax that is due and then distribute the estate. There are, in fact, three problems:
- access
- valuation
- location
Most of the internet or digital service providers regard their service as a lifetime service and do not see the concept of a digital legacy at all. It is a common contractual term that when an account becomes permanently inactive it will be deleted. It would be much better for you to engage with the service provider and ensure that you have made your wishes known as to what you would like to happen after your death. For example, you should state that access should be passed to a certain individual. Google provides an Inactive Account Manager service for this purpose. Apple say that their digital downloads are for your lifetime only. Similarly, your Photos in iCloud will disappear. You could store your Apple ID and password with your Will so that executors can deal with your data. You might be surprised to know that the balance on some dormant accounts could be paid to the Treasury of Luxembourg or indeed to the Malta Lotteries and Gaming Authority.
Further issues arise where the executors or next of kin have to value the digital assets. Provided they can locate them, this often will not be a problem but digital assets in the form of pure gaming characters may require specialist assistance. There are exchanges on which such virtual items can be sold, such as Sony’s Live Gamer Exchange.
As a starting point, create a personal balance sheet that includes the basic details of your digital assets, such as names and web addresses for each account. You can find examples of the most common types of digital assets in the free Digital Wishes pack on the SunLife website at www.sunlife.co.uk/over- 50-life-insurance/digital-legacy-guide
Also consider whether you’ve anything stored on your computer or in iCloud storage such as valuable photographic or other creative work. Draw up your digital asset inventory These may hold sentimental value too. Check the terms and conditions of the accounts and services that you use, as some may allow you to pass licences on to particular beneficiaries.
The solicitors at Fergusson Law are experienced and ready to advise you about including your digital assets in your will.
This article has been updated from the original first posted on April 2014.