What are Digital Assets?
A digital asset is, essentially, anything that is stored in a binary format and comes with a right to use. 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/online accounts, for example, photographs, word documents, family videos, emails, instant messages, spread sheets and most other property which you create and/or store digitally.
Most accounts will be password protected and only you will have access to them and, in some circumstances, only you will even be aware of their existence.
Why does it matter?
Some of these assets may have a monetary value, such as the balance on your PayPal account, bitcoins and digital intellectual property. Accordingly, you may wish your attorney or executor to have access to those funds. Other accounts, such as iTunes and Amazon Kindle accounts may not have any value as such, but you may wish, where possible, for someone else to have the benefit of them.
For social media accounts, such as Facebook and Twitter, you may wish to decide in advance how those accounts should be dealt with. In many cases, such accounts hold a lot of personal information which it may not be wise to allow to remain online indefinitely after your death. Accordingly, you should decide who, should have access to them (and for what purpose) following your death.
If you do not leave instructions, it is possible that your Executors/family will know of your more obvious digital assets and therefore be able to take steps to wind them up, albeit without your instructions. However, this is not always the case. If you own bitcoins or gaming credits for example, due to their nature it is unlikely that your Executors will know how to find them unless you leave specific instructions. Domain names can also provide particular difficulties as, if you die shortly before your hosting fees become due, the name could be allowed to lapse unintentionally through non‑payment of fees. It is therefore important that information is available to your executors so that they can deal with these issues promptly and effectively.
Your Digital Inventory
The first step in making provision for your digital assets is to clearly identify them and keep a record of them for the benefit of your executors.
Several providers, for a fee, now offer 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. Examples of these providers are Legacy Locker, Assetlock and Deathswitch.
An alternative is to keep a written list of accounts and access details in a safe place. This should not be included in a Will directly as, following deaths in Scotland, Wills become public documents.
The difficulty with both approaches is that you must keep your list of passwords up to date.
How, or whether, you can pass ownership of your digital assets to your chosen beneficiaries depends on the policy of the particular Internet Service Provider (ISP) with whom your account is held. Unfortunately there is no uniform set of rules. Succession to your digital assets is not likely to have been on your mind at the point your signed up to the ISP's terms and conditions so it will be necessary to go back and check your rights on death and responsibilities as an account holder, particularly as regards keeping your usernames and passwords private.
For example, in the case of iTunes and Kindle accounts, you are effectively leasing the content, not buying it. So you can leave your ipod or kindle to your chosen beneficiaries under your Will but, in theory, you cannot leave them the contents of your accounts. Practical workarounds are possible, for example, by sharing your password and account details but the risk is that you could be in breach of your ISP agreement and/or the ISP could suspend your account if they become aware of your death.
Succession to your Digital Assets
As part of your succession planning you should consider who you would like to benefit from your digital assets and how you would like your online presence to be dealt with after your death.
You may wish to include a digital assets clause in your Will. This could take the form of allowing your executors the discretion to decide who should benefit from any digital assets with monetary or sentimental value, or you may wish to be more prescriptive and leave certain digital assets to named beneficiaries. You should also consider whether social media accounts should be shut down or"memorialised".
You may also wish to appoint a separate"digital executor" or at least ensure that one of your executors is digitally literate, so that any legacies can be made over and your other wishes carried out.