Bereaved left confused by ‘arbitrary’ probate policies

Families of the deceased risk being caught out by the maze of confusing and widely differing standards of financial services providers when it comes to getting access to loved ones’ estates.

When a person dies, the executor of their estate must apply for legal permission to access their assets before they can be passed on to friends and family. This is known as a “grant of probate”.

Conventional wisdom states that probate will be needed if you are trying to withdraw funds from an account worth more than £5,000.

However, probate thresholds are set independently by banks, building societies, fund shops and pension providers and can vary enormously.

While some companies will release funds without a grant of probate if an account contains less than £50,000, for example, other providers will demand evidence of probate before releasing any funds at all.

It costs £215 to obtain probate and the process can take up to a year, or more in complex cases.

Telegraph Money found that in some cases the probate thresholds set by providers could have a difference of more than £100,000.

There is no standard even among the same type of financial service. Barclays has a probate threshold of £50,000, while rival bank NatWest puts the limit at £25,000 and HSBC decides on a case-by-case basis.

Among fund shops, Fidelity’s threshold is £25,000, the Share Centre’s £15,000 and Bestinvest always requires a grant of probate.

The insurer Zurich said that if a solicitor was dealing with an estate, probate would be needed only to access accounts containing more than £150,000, while other firms, such as the pension provider PensionBee, said they would almost always ask to see a grant of probate. Martyn James, of the complaints service Resolver, said he had been dealing with complaints around probate for years and had never been able to get a clear explanation for these conflicting standards.

“This is one of those weird idiosyncratic things that have been around since the dawn of time and that people just aren’t questioning,” he said. “The thresholds are set in a completely arbitrary way. I have tried time and time again to get an explanation of why they do this and I have never been able to get a convincing argument.”

Mr James said the lack of clarity in the way financial service providers dealt with bereavement and probate left families frustrated. He added that the confusing nature of the current set-up piled enormous pressure on executors, who were already juggling various tasks and often did not have a background in finance.

“This complete inconsistency in allowing banks and building societies to set their own probate limits fundamentally needs to change,” he said.

As it is difficult to know whether or not a grant of probate will be required, it is worth contacting each provider to find out their individual policy before going to the probate registry.

Probate thresholds can vary enormously