Digital assets: What are they?
Digital assets are increasingly part of everyday life. Most simplistically, they can be defined as anything that you may own or have rights to that exist online or on a hard storage device. In general, this means any accounts that you open online, including email, social networking, and photo sharing, as well as websites and domain names which you own. It also includes the items stored on your computer or online accounts, for example, photographs, word documents, family videos, emails, instant messages, spread sheets and any balances on your PayPal or gaming accounts.
Why do they matter?
Digital assets can have financial or sentimental value. Your personal representatives may not be aware of them to deal with them on your behalf. This could result in a lot of information about you in various forms being available after your death which may not be appropriate.
Each provider of the digital asset will have its own terms and conditions that will determine what happens to the asset on the death of the account holder. They will also set out what access your personal representatives will have in order to administer that asset. Most of these terms and conditions forbid the sharing of any online content, such as by way of a bequest in a will.
What should I do?
There are a number of things that you can do to start to address this issue.
It is important that you have an understanding of your digital assets so that you know which ones need to be managed on death and which ones can be gifted in your will. An example to illustrate the importance can be seen with Bitcoin. A virtual asset that can have substantial financial value is saved in a password protected digital ‘wallet’. If the wallet, the password or the device on which the wallet is stored are lost, the asset, and its value, is lost permanently.
I would advise checking the terms and conditions of all your digital assets and keeping a log in a safe place that your personal representatives are aware of. Do not put any passwords in your will as this may become a public document if probate is required and, in any event, will be shared by some of your beneficiaries who may not be the recipients of your digital assets.
How, or whether, you can gift your digital assets depends on the terms and conditions of the particular Internet Service Provider (ISP) with whom your account is held. There is no uniform set of rules. For example, in the case of iTunes, you are effectively leasing the content so you do not own it. Whilst you can gift your iPod in your will, you cannot leave them the contents of your accounts.
There are providers that offer a chargeable service of an online “safety deposit box” in which you can store your usernames and passwords. Those details will then be made available to a nominated person following your death.
Have a routine of downloading photographs of sentimental value on to a hard drive ensuring that these will not be lost post death.
Ensure that the people you are asking to deal with your digital assets have the technical skills to deal with them. You could appoint a digital executor that only deals with your digital property.
When making your will, ensure that you have a conversation with your solicitor about your digital assets.