Don't let your cyber legacy go dark, include virtual assets in your will

Creating a will that covers digital possessions involves several key steps. Start with a comprehensive inventory of assets, including login details and access instructions.

In an increasingly digital world, estate planning is no longer confined to physical properties like homes, jewellery, or bank accounts. Digital assets — ranging from cryptocurrencies and social media profiles to online businesses and cloud-stored memories — now form a significant part of people's legacies.

Failing to include these in a will expressly may leave valuable assets such as family photos or financial accounts inaccessible or even lost to heirs, while also exposing confidential information to risk or legal limbo.

Why digital assets matter in estate planning

The significance of incorporating digital assets into estate planning lies in preserving both economic value and sentimental worth.

Rahul Hingmire, managing partner at Vis Legis Law Practice, said, “Digital assets that must be included in a will extend well beyond traditional bank accounts.” For instance, a will should cover cryptocurrencies, demat and trading accounts, UPI wallets, e-commerce credits, and intellectual property such as blogs, domain names, YouTube channels, and social media handles. Without proper planning, families may face roadblocks, as global platforms often require explicit authorization for access post-death.

Saswati Soumya Sahu, partner at ANB Legal, said, "Digital assets become particularly relevant for businesses that thrive online. These can be included in a will by giving executors the authorisation to access and manage these after one's death."

Crafting a will for digital possessions

To create a will, start with a comprehensive inventory of digital assets, including login details and access instructions.

Navigating the digital afterlife is a critical frontier. "The primary challenge is to identify virtual assets like cryptocurrency or NFTs. It is also imperative to ensure the family has the legal and technical authority to manage them for multiple generations," said Kanchi Gandhi, Managing Director, Kotak Mahindra Trusteeship Ltd.

"The inclusion has to be within the main will itself, not as a separate digital will,” Hingmire said.

The process requires a clear inventory, an annexure for access details, specification of beneficiaries, and appointment of an executor with powers to act.

“Interim nominees can also be named where platforms allow, ensuring families are not locked out of high-value assets until probate concludes," Hingmire said.

"One can designate a trusted individual to specifically handle your digital estate. This preserves your digital legacy as per the instructions of a person,” Sahu said.

The chosen executor or beneficiaries can maintain a centralised document with passwords and names of people who will have access. This document needs to be a separate document than a will. Questions such as should accounts be closed, memorialized or transferred to another person should be clearly provided.

Unlike a physical asset with a clear title, a digital asset's "ownership" is often governed by a platform's terms of service, which can often be hostile to third-party access. "The idea is to shift the approach from simply creating a will to proactively collaborating with legal and technical experts to ensure that succession is taken care of based on the terms of the platform," said Gandhi.

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Common misconceptions and legal challenges

Shweta Tungare, Co-Founder of Law Tarazoo, said people often misunderstand key aspects of digital assets in estate planning. Many believe a generic will clause is sufficient but digital assets require specific instructions for management and distribution. Others assume service providers will automatically grant access to heirs, which isn't true without explicit instructions.

Some think digital assets lack real value, ignoring the significance of assets like social media profiles, emails, and cryptocurrencies.

Heirs don’t gain automatic access and passwords alone are not enough, Hingmire said. "In reality, families have fought over crypto wallets, gaming tokens, and monetised YouTube channels, proving the need for formal inclusion," he said.

The Indian Succession Act, 1925 governs the probate process, but additional considerations will need to be accounted for digital assets.

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Benefits of digital estate planning

"Incorporating digital assets into estate planning not only preserves legacy and value, but also protects privacy and prevents disputes,” Tungare said.

Ultimately, proactive digital estate planning future-proofs succession arrangements, providing peace of mind for individuals and their families.

"Incorporating digital assets in estate planning ensures no wealth is stranded, avoids family disputes, and safeguards continuity where digital platforms are tied to income,” Hingmire said. For families, this clarity saves years of litigation and provides peace of mind during succession.

"It is important to bridge the gap between traditional succession plan and the complex, borderless world of a person's virtual legacy, thereby safeguarding a client’s wishes in a landscape that's constantly evolving," said Gandhi.

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Global perspectives on digital estate planning

Globally, practices vary but offer lessons for India.

In the United States, RUFADAA empowers executors to access emails, cloud storage, and social media if named in a will, Hingmire said. The UK treats cryptocurrencies and domain names as inheritable property, though private keys remain essential.

"Then, Spain provides an indicative framework for regulating digital assets," Sahu said.

Digital legacy is defined as the corpus of electronic data that users leave behind, either in physical medium or on the internet, when they die.