And finally…most Scots losing out on inheritance loyalty point millions

Scottish consumers belong to around four loyalty programmes each, with adults collectively earning at least £585 million each year in rewards.

However, a large part of this pot is likely to be lost because people do not fully understand the value of their loyalty and as a result neglect to use them up or think seriously about what will happen to it when they die, according to a new report produced by cashback shopping site TopCashback.co.uk.

The site’s Loyalty After Death report found that three-quarters (75 per cent) of people in Scotland do not know what their loyalty rewards would convert to in pounds and therefore underestimate their worth. The majority (89 per cent) of consumers also save up their loyalty and therefore are sitting on a large amount of unclaimed money from loyalty schemes.

Alongside not understanding their loyalty’s true worth, an astonishing 95 per cent of Scots do not know they can pass on their loyalty rewards to a loved one in the event of their death. As a result, people are failing to share details of their loyalty schemes meaning an unidentified figure stands to be lost when consumers pass away.

The report reveals the majority (92 per cent) of people do not have a plan for their loyalty. Nearly half (45 per cent) of Scottish consumers have not even considered it as an option and around two-fifths (38 per cent) do not think it is possible to pass on loyalty.

With consumers in Scotland not seeing bestowing their loyalty as an option, 77 per cent have not shared their loyalty account details or passwords in the event of their death. Furthermore, 56 per cent of people have not made their family or friends aware of the loyalty programmes they belong to, meaning the money they hold could be lost forever.

Just five per cent of people in Scotland have left their passwords with a solicitor and only four per cent have included a list of their loyalty programmes in a will.

Adam Bullock, UK Director of TopCashback.co.uk, said: “Loyalty programmes can be incredibly rewarding and making the most of the benefits offered by companies, ensuring you get more for your money, is increasingly important in the current economic climate. While we would always encourage consumers to redeem their loyalty for themselves, people do like to save it up and therefore we also want to encourage consumers to have a plan in place to ensure their loyalty is not lost if they were to pass away.

“The first step is to leave the usernames and passwords of your loyalty schemes with a loved one or include them in your will. By doing this, people can at least be aware of the accounts you hold and the loyalty that is left behind allowing them to make a decision on what happens to the remaining loyalty.”

However, eight per cent of consumers have a very clear plan in place. Of those, a third (33 per cent) plan to bequeath their points to a partner or child. A quarter (25 per cent) will hand them down to another family member and 17 per cent will leave them to a friend. Eight per cent of people have even decided to gift their loyalty to charity.

The report also reveals loyalty programmes have different policies across the board when it comes to bequeathing loyalty when someone passes away.

Schemes including Nectar, Tesco Clubcard and Avios allow points to be transferred to another person in the event of death. However, some flight reward schemes and the IKEA family card do not allow for points to be transferred or passed on. The Virgin Atlantic Flying Club will only transfer points if the account details are explicitly mentioned in a will.

The majority of schemes require a death certificate and the process of transferring points can be lengthy.

Adam Bullock continued: “When planning what happens to your loyalty it is worth looking into the policies your loyalty schemes have on bequeathing rewards. While most will allow you to pass on your points it is not always the case. Depending on the policy you may want to make plans to use the points or transfer them to someone beforehand.

“Our policy on bequeathing cashback allows for members to name someone as a beneficiary in their will or for a loved one to withdraw any funds by providing a copy of the death certificate. Loyalty is huge in the UK and we would encourage all companies to follow a similar policy and allow their members to pass on their loyalty. People should be allowed to hand down their property, their car and their air miles”.

Leigh Sagar, from family inheritance specialists STEP, said: “In legal terms, a consumer is entering into a contract with a company when joining a loyalty programme. The contract is not an onerous one, but it does contain certain terms and conditions that will be enforced by the court. These terms normally provide that only the registered user, or in some cases, persons in the same household, can collect and spend loyalty rewards.

“When the registered user dies, however, the points usually die with them unless their personal representatives contact the company in accordance with the required procedure. Although the terms and conditions usually state that the points have no cash value, they can be converted into goods and services that do have a value. Therefore, if the terms and conditions provide that the points can be claimed after death, unless they are of negligible value they should be declared as an asset in the tax forms that must be sent to HM Revenue and Customs before a grant of probate can be obtained. Legal advice should be sought in each case.”