May
29
Can Frequent Flyer Miles Be Inherited?
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Can frequent flyer miles be inherited? The short answer is, potentially. The fine print in most membership guides stipulates that transfers are not allowed under any circumstances, but attorneys like Robert K. Kirkland argue that digital assets such as frequent flyer miles and hotel points are "definitely an item of property that's potentially transferable on death." The problem is, the airlines control the terms of those property items. 

Delta's restrictions state "Except as specifically authorized in the Membership Guide and Program Rules or otherwise in writing by an officer of Delta, miles may not be sold, attached, seized, levied upon, pledged, or transferred under any circumstances, including, without limitation, by operation of law, upon death..." Yet Roberta Bekerman faxed Delta two weeks after her husband, a trust and estate lawyer, died, requesting his 28,547 miles be transferred into her account, and they honored her request. 

United's MileagePlus program rules state "Accrued mileage and certificates do not constitute property of the member and are not transferable other than as authorized and/or sponsored by United." Yet the airline issued a statement saying that they have "made case-by-case exceptions" in the event of death or divorce. 

Since these rules are not set in stone, estate lawyers should make provisions in clients' wills to state who will inherit the accruals in their loyalty programs. If not specified, these items are divided, however the executor may have to make special steps to get the programs to honor the transfer. If you want to be 100% certain your beneficiaries inherit these digital assets, go with American Express. Their program specifically allows the transfer of points at death--but beneficiary beware! If you close the account, you lose the points. 

 

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