What are digital assets and why should you care about them when you think about your estate plan? Today, almost everyone maintains a digital presence and it is increasingly common for individuals to have a significant amount of assets and personal information that
are stored digitally. Your digital assets include all of your online accounts and digital files that you own.
Some digital assets have sentimental value – like photos, music and diaries. Some have financial value like your music or movie collection, your website domains or even an avatar. In other cases, it is not so much an asset that you might want to be concerned with but rather a right of access to an asset or a bill you receive and pay electronically or to personal files stored in cloud based digital repositories. This is because digital assets can also include files, usernames and passwords stored in a digital format, such as on a flash memory device or hard drive, as well as password-protected banking or accounts that exist online.
Ownership and Access to your Digital Assets
It seems straight forward that the use and access to your digital assets is to be enjoyed by you. If you lose your password, or username, you should be able to have some means of retrieving them or getting news ones from your service provider. However, what happens to your digital assets after your death? Without the proper planning and authorization in place as to the access and use of and or access to your digital assets or information or assets that you access
through the internet, after your death it may not be possible for your beneficiaries, agent or other representative to gain access to your digital assets in order to organize or distribute them without
obtaining a court order. Most service providers prohibit the use of an account by anyone other than the account holder, as well as the sharing of a username and password with others, even if
that someone is your Estate Trustee. Alternatively, it may be that you have digital assets that you do not want some people to have access to.
What happens without Proper Planning for Access to your Digital Assets?
The inability to gain access to certain information that is stored electronically can create an administrative nightmare for your estate trustee. Without proper planning, there could be fees faced by your estate that you may not have anticipated. Imagine for example an electronic bill that cannot be accessed after your death. Such an unpaid electronic bill could result in fees and penalties that must be paid but that could have been avoided. Think of how many people you know who have died but continue to have active FaceBook accounts. You might also find that your loved one had automatic renewals for things like domain names that the Estate is continuing to be charged for. You might have assets that never get transferred since no one knows of them, like possibly an avatar with a significant resale value or a domain name. By establishing an estate plan that includes for a smooth transition of all of your intellectual property, including your digital assets, you can better ensure that your wishes regarding your digital assets are carried out and that your estate trustee has access to the information he or she needs to properly administer your estate.
How a Lawyer Can Help
It is important to remember that digital assets are just as important as physical assets and that the need exists to make the proper arrangements to determine who should maintain control of these assets upon your death and how. A lawyer can assist you with thinking about who should have access to what in a confidential setting. A lawyer can also help you to include proper wording in your will to improve access rights to digital assets. However, until service providers
come up with more sensible policies to address the reality that people die, there may continue to be struggles over things like accessing, maintaining and closing your online accounts and your
digitally stored information.
For some additional information about digital assets, see the attached link to a video reported by
Global News in 2013.
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The article posted here is for general information. We hope you find it useful. For advice specific to your circumstances you should consult a lawyer. We would be pleased to speak with you if you have questions about our services or need the assistance of a lawyer.
with assistance by Rachel Lechcier-Kimel