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Loyalty and the afterlife

If you haven't thought of what to do with your loyalty program points when you die until right now, you are not alone.

Eighty-four per cent of Canadians have never even thought about what happens to their loyalty points when they die, but at least 25 per cent of them care what happens to those points after death once you ask. This, according to research from LoyaltyOne, a global provider of customer insight, strategy, loyalty, marketing programs and customer experience management.

"As a result, the inheritance of loyalty points is not a marketing hook for these companies, but it's still a really important part of how they structure their loyalty programs," says Jeff Berry, LoyaltyOne's senior director of knowledge development.

In fact, of the major loyalty programs in Canada (Airmiles, Aeroplan, HBC Rewards, Petro-Points WestJet Rewards, etc.), only Shoppers' Optimum Rewards and Petro-Canada's Petro-Points don't allow you to transfer your loyalty points to an heir or allow your executor to redeem the points on your behalf.

So, if you have a ton of loyalty points and don't want to see them die with you, how do you go about making sure they go to use long after you're gone?

Passing on the points
Generally, it's not necessary to name the person you bequeath your points to in your will to start the process.

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"Points are not considered an asset, but they do have stored value," says Berry. "You would need to make sure that within your will, you list what reward programs you belong to, your account numbers and your passwords, similar to how you would with your bank accounts. The programs generally don't require that a specific person be named."

However, the companies do have policies around how their loyalty points can be redeemed, so you may need to produce a death certificate as proof of death, so the companies are able to inoculate themselves against fraud.

LoyaltyOne found that only 3 per cent of Canadians had written down their reward program details in their will or shared the details with their executor.

Other options and advice
Points themselves generally can't be converted to cash, but most programs do offer a cash equivalent of some kind.

"There's a reward option that is usually cash-like, such as a gift certificate that can be redeemed or offers so many dollars off at a particular retailer," says Berry, adding that you can also redeem points to buy actual merchandise.

As to which is the better rewards program to belong to, whether you're living or dead, Berry says they each serve their own specific niches.

"Airmiles is focused on frequent shopping behaviour, while Aeroplan is focused on frequent flying behaviour with fewer retail partners. It's not that there's one that's better than the other, but they are serving markets differently."

He recommends that when choosing a program, consumers evaluate the kind of rewards that they're interested in and figure out how many earning opportunities for the program there actually are.

"Do you want to use these programs like cash or do you want to be able to save for things like merchandise and travel, while being able to change your mind along the way? How long will it take you to get to something of significant value?"

Aaron Broverman is a freelance writer in Toronto

-- Posted July 15, 2013
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