A short while ago I was asked what happens to Debit Orders on a person’s bank accounts when you die. This was something I had not even thought about as I don’t have any debit orders myself. Anyway, this is what I have managed to learn.
As soon as the bank is informed of a person’s death, the account is frozen as at the day of death and no more payments may be paid out. This means that no Debit Orders will be paid to any Creditor. As soon as a death has been registered, it is important that all financial systems are followed up. Debit Orders can be as diverse as utilities, mortgages, retailers etc. To ensure that the utilities, such as electricity and water, are not disconnected due to lack of payments, it is probably best to tackle these first. It is the Creditor who cancels or changes the Debit Order; you or the Executor need to approach the Creditor and not the bank.
The creditor may ask to see a copy of the death certificate and some form of proof that you have the legal authority to deal with the deceased person’s accounts. The Executor will have been given a Letter of Appointment by the Master of the High Court, so is the ideal person to contact the creditors but, where a spouse or other person has had Power of Attorney on an account, that appointment letter may suffice. Remember, time is of the essence and it takes time for the Executor to be appointed, it is advisable to do what you can to prevent withdrawals or any fraudulent activity on the deceased’s accounts.
To be sure that your Executor or family member knows what Debit Orders are on your account by making a list of these and any other relevant information and keep it with your Will. Your list should include bank account details, insurance policy numbers, utility bill details, charity donations etc. Do all that you can to simplify and speed up the process of winding up your estate.