The Law Society recently published a survey that showed that only 7% of those surveyed understood fully what would happen to their digital assets after their death. The survey also found that of those who had written a will, 93% had not included any digital assets.
The figures are unsurprising. When taking instructions for wills, I am usually met with silence when I enquire whether the clients have considered their digital assets. It is usually followed by a discussion about what is a digital asset and surprise when people realise they own more digital assets than they had initially appreciated. Although many digital assets will have mainly sentimental value, some may have monetary value and therefore need to be properly considered.
What are digital assets?
Digital assets are non-physical assets that are stored electronically and that exist online or on an electronic device. Some examples are:
- Social media accounts, smart phone apps and the information stored on them
- Websites, blogs or documents
- Digital photos, e-books, video, music and film purchases
- Bank accounts, credit cards, PayPal accounts
- Online rewards programmes and loyalty points eg Airmiles, Clubcard
- Domain names you own, intellectual property, trademarks
The definition of personal chattels is contained in section 55(1)(x) Administration of Estates Act 1925. The world has changed beyond recognition since then and the legislation has failed to keep up.
Most wills include a clause stating to whom personal assets would pass when the testator dies.
Clients should also consider their digital assets in the same way and express their wishes as to what should happen to them when you die. A written form of expression is the clearest way, either within the terms of the Will or in a separate Letter of Wishes. The latter would be more useful due to the ease of amending this as required without the need to execute a new Will and this less costly.
Of primary importance is keeping a record of your digital assets. Make a note of the asset with instructions of how to access it. If you decide to make a note of usernames/passwords/memorable information, this should not be disclosed and may need to be updated as the details change.
Service providers usually include in their policies what would happen when the account holder dies. In some cases it is possible to appoint someone that can manage the digital asset on a legacy basis. You should find out who would be able to access the data when you have died and how. Some data, eg photos or social media accounts may be assets you might want family members to be able to access in the future.
Due to the pace of technological advancement, media can become obsolete. Who uses floppy discs anymore? Consider backing up your data eg printing photos or transferring data to a separate hard drive.
The law is changing. The Law Commission has announced that it has started work analysing English Law in the context of digital assets, and in particular, possession of those assets. This development followed the release of a statement by the LawTech Delivery Panel on the status of crypto-assets. The effects are far-reaching as trade and commerce move towards digitisation of transactions which will have a spillover effect into a person’s daily transactions. This is an interesting and developing area of law.
Please contact Shahida Jogi, Senior Associate Solicitor in the Wills and Estate Planning Team on 0151 317 3355 if you have any queries or would like to discuss your Will.