Lockdown has put pressure on banks’ bereavement services, making it harder for grieving families to settle the finances of loved ones who have died.
Which? has uncovered many stories of executors who encountered serious delays and administrative errors when dealing with banks.
Coronavirus seems to have made the problem worse: one in 10 people who were responsible for closing a deceased person’s account after the March 2020 lockdown said they were dissatisfied with bank staff’s skill and knowledge during the process, according to our survey of 1,600 Which? members.
Notifying banks of a customer’s death
If someone dies and you’re named as executor in their will, you’re likely to need probate – a document that confirms your role and that you have authority to administer the estate.
It’s not always necessary – you might be able to close an account without going through probate if the total balance held with a provider is below a certain threshold. And regardless of the size of an estate, if all the deceased’s accounts were held in joint names, their assets pass to the surviving co-owner.
Most banks will release some funds without probate to help cover costs, such as funeral expenses and inheritance tax. But the amount varies significantly – some banks will release only up to £5,000; others, as much as £50,000.
If you’ve been made responsible for settling the affairs of someone who has died, the first step is to notify financial providers of the death. The Death Notification Service allows you to tell participating banks in one go, and you’ll then be contacted within 10 working days about the next steps.
You’ll probably be asked to provide copies of the death certificate, some form of ID and proof that you’re responsible for administering the estate.
- Find out more: your essential probate checklist
Delays worsen during lockdown
If everything goes smoothly, closing someone’s accounts after they’ve died can take a matter of weeks.
But for one in six (17%) people in our survey, the process lasted more than three months. And this was for those who closed accounts before the first national lockdown in March 2020. Among those who started the process before lockdown and continued it afterwards, the figure rose to around four in 10 (37%).
Getting in touch with financial providers in the first place became more challenging during the pandemic. Before lockdown, only 3% of executors said they found it very difficult to contact the right people. But that figure rose to one in six (16%) among those for whom the process of closing accounts continued beyond March 2020.
Delays by banks are never convenient. But during a national crisis, going without access to funds for three months or longer can take a serious toll on those who are already struggling financially.
‘Shambolic’ administrative errors
As well as delays, we also came across evidence of banks making sloppy – and sometimes upsetting – administrative errors while dealing with the bereaved.
Dozens of people told us that the had bank lost the death certificate after they registered the death. After HSBC lost one man’s death certificate, his bereaved daughter – who said the whole process was ‘shambolic’ – had to find £4,000 herself for the funeral.
Other executors said they had to chase banks repeatedly to get them to close their loved ones’ accounts.
It took NatWest 10 weeks to release the funds to Julie Lockwood and her brother after their mother passed away in July 2020. During that time, they had to make multiple trips to different branches because they were given conflicting information.
‘Neither of us will ever bank with NatWest again,’ Julie told us.
A Barclays customer told Which? that the bank misinterpreted his instructions and set up an executor’s account that couldn’t be managed online – a big inconvenience during the lockdown.
He wrote a letter of complaint to which Barclays never responded. Barclays says it has since been in touch to resolve the issue and has apologised for the confusion.
- Find out more: inheritance tax explained
Which banks are most difficult to deal with?
Our survey revealed big differences in executors’ level of overall satisfaction with staff skill and knowledge during the process.
The providers with the lowest levels of overall satisfaction among executors were Barclays (58%) and HSBC (67%).
Meanwhile, the providers with the most satisfied customers during the process were Post Office Money (86%), Nationwide (80%) and Santander (80%).
HSBC said: ‘We sincerely apologise that in these cases we have fallen short of the high standards we set ourselves and have taken steps to help ensure the experience with us going forward is a better one. Customers can now report a bereavement to us via our website and submit required documentation electronically, and we have recruited at pace to bolster our dedicated bereavement team. We are working hard to make sure that our customers have the support they need.’
Barclays said: ‘We understand handling financial matters after a bereavement can be a complex and emotional process. We strive to make that experience as easy as possible for our customers’ loved ones.’
- Find out more: how to administer an estate
Probate can be a drawn-out process, and there’s no limit on how long it can take. Taking the following steps can help ensure things go as smoothly as possible:
- Try to gather the details of your loved ones’ accounts before they pass away
- Order multiple copies of the death certificate
- Consider getting professional help to accurately value the estate
- Keep detailed records, as you’ll be dealing with lots of different organisations
- Keep beneficiaries in the loop
- Complain if things go wrong. You can escalate complaints to the Financial Ombudsman.