Premium Bonds: NS&I rules on what happens to bonds when you die

Premium Bonds, a lottery system run by the National Savings and Investments company, operates a prize draw each month, with the top prize standing at a staggering £1 million. The lottery bonds are paid into by the government, and a monthly prize draw then provides selected bond holders with a payout. Because Premium Bonds are a type of lottery bond, the more you buy, the greater your chance is of winning. 


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The bonds cost £1, however the minimum investment stands at £25, with the upper limit at £50,000 per person. 

But many wish to know what happens to Premium Bonds upon the holder’s death.

NS&I has provided bond holders with this information to help them make decisions about their savings.

The organisation states Premium Bonds become a part of the holder’s estate upon their death.

After a person dies, these Premium Bonds can continue to take part in prize draws for 12 months following the date of their death.

This is, unless, the bonds are cashed in prior to this deadline.

If a bond does win a prize after a person’s death, NS&I takes specific action regarding this matter.

If receiving a prize warrant, the relevant surviving person should send this warrant back to NS&I.

The organisation will then reissue the prize to the person entitled to the money, once a claim has been completed.

Any other prizes a customer wins will also be held by NS&I until the claim is completed.

And future prizes will also be rerouted to the person who is entitled to the money, and will be sent by warrant. 

It is important to note that these prizes cannot be paid out electronically.

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NS&I also cannot consolidate prizes to pay them at the end of the 12 month period. 

It is estimated that roughly 21 million Britons currently own Premium Bonds, meaning many could ultimately win a prize. 

As NS&I is government-owned, there is no risk to any capital placed into a Premium Bond by the owner, as it will never go bust.

The organisation is supported by the Treasury, meaning any Premium Bond owner is only gambling the interest and not any other funds. 

Premium Bonds have been issued in the UK since 1956, and pre-date the famous National Lottery draw.

Each month, the numbers are generated by a machine, colloquially known as ‘ERNIE’ – the Electronic Random Number Indicator Equipment. 

The odds of any £1 Bond number winning any prize currently stands at 24,500/1.

And bond holders should pay attention, as the next draw is scheduled to occur in just days for the June monthly draw. 

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