Is death compensation part of the estate of the deceased?

Trusts Discussion
1

I was researching on the issue of how death compensation (in the case of someone died in a car accident) was dealt with under Chinese laws.

The conclusion is clear: under Chinese laws, if someone is killed in an accident (either road accident or work-related injuries), the death compensation claimed from the wrongdoer is not part of the estate of the deceased person. Instead, this compensation can only be claimed by the close family members, out of the reach of the creditors of the deceased.

As a lawyer mostly practicing cross-border family laws (in a broad sense covering inheritance and estate planning), I instinctively turned to see how the same issue was dealt with in common law countries and regions.

Surprising, I came to read an article (7. A member of my family died in an accident. Can I initiate personal injury proceedings on behalf of my family member? What is the procedure that I have to follow before suing the wrongdoer? | Community Legal Information Centre (CLIC)) which said that such death compensation is to be claimed by the executor or administrator, not by family members. In other words, the death compensation shall form part of the estate. However, there are more questions popping up in my mind, for example: Is it possible for someone to plan on such dean benefits in their wills? What if the executor fails to take action to claim such benefits?

I would like to learn more. Thanks in advance.

2

Hello,

Various circumstances where this may arise, the majority here is covered by Fatal Accidents Act 1976

A claim maybe brought by a dependent for economic loss and funeral expenses, dependent is defined in the act.

Richard C. Bishop
PFEP

3

Hi Richard, could you please elaborate further on how it works under Fatal Accident Act? What role does an executor play in claiming the death compensation? Is there a priority order among executor/administrator and family members?

Thanks.

4

Hello,

The executor or adminstrator of the estate has 6 months in which to bring a claim (s.2.1 FAA 1976), if they fail to do so, any dependent (s.1 FAA 1976) may bring a cliam in thier own name (s.2.2)

Any claim is paid directly to the dependents (in equal shares) if more than one (s.2 (a)4). The payments would not form part of the estate for IHT purposes.

My understanding.

Richard C. Bishop
PFEP