Fixed Term Account closure penalties

Onawingandaprayer

On the death of a holder of a fixed term savings account, are the closure penalties automatically waived, or does it vary from provider to provider?

Is there a hard and fast rule that covers all providers?

Sorry to start the week off with a depressing question!

kostigovs

I think you will find an explanation in the terms and conditions of the account.

More learned folks on here will be able to tell you precisely but I would think that the account will earn interest up to the death of the account holder and then just automatically mature(on the death) presumably subject to production of death certificate

Onawingandaprayer

Had a reply from Cahoot, which I'd like to share.

Thank you for contacting cahoot in Coventry.

Upon death of an account holder, the same terms apply, in that any withdrawals made during the 2 year period will incur a loss of 120 days equivalent interest.

You can only withdraw the whole balance, and if you do this at any time but not after the 120th day, no interest will be paid and only capital will be paid back to you.

Are they saying what I think they're saying? They will penalise the account holder (or at least his/her heirs) for dying?

Have asked them to clarify.