"My Only Heir Is a Cat"... Who Manages the Property of Pets?

"When I Die... What About Pets Left Alone?" Concerns
Pet Care and Inheritance Management Service 'Pet Trust'
Growing Awareness of 'Pets as Family' Leads to Gifts and Inheritance

What should be done if a pet owner dies or is unable to care for their pet due to illness or other reasons?

Last week, the story of a dog wandering along a main road in Dongducheon, Gyeonggi Province, with a note left by its owner attached to its leash touched the hearts of everyone who saw it.

The note read, "I don't have much time left to live, so I am going to a government-run facility. Please take care of my beloved son."

The number of people living with pets currently reaches 15 million. When hearing stories like this, anyone would worry, "What if my pet gets very sick when I'm not around?" or "What will happen to my pet if I die?"

Fortunately, there are alternatives. These are pet-related financial products.

To ensure peace of mind even when I'm gone... Consider a 'Pet Trust'

Photo by Pixabay

In response to the concerns and demands of pet owners, financial institutions both domestically and internationally have launched 'pet finance' products. These include not only pet insurance to prepare for times when pets get sick but also pet trust products that allow pets, considered family members, to inherit assets.

The pet trust product is an application of a 'testamentary substitute trust.' This product is designed so that if the pet owner (the settlor and lifetime beneficiary) dies and cannot care for the pet, funds necessary for the protection and care of the pet are provided to a new caregiver (posthumous beneficiary) after the owner's death.

For example, the pet owner designates a trustworthy person through a trust contract during their lifetime. Later, if the owner's health deteriorates or communication becomes limited, the designated person can care for the pet or find a new owner through an adoption agency.

To prevent the posthumous beneficiary from taking the pet's maintenance money and running away, payments can be limited to a fixed monthly amount. If a large sum is expected to be spent on hospital bills, the posthumous beneficiary can notify the trustee (securities company), who can then pay the hospital or other expenses directly.

Since caring for the pet after the owner's death is the core of the pet trust, a lawyer can monitor whether the posthumous beneficiary is properly caring for the pet. If the pet is not being adequately protected, a contract clause can be added to request the court to revoke the will.

Designer Karl Lagerfeld, known as the legend of Chanel, and his beloved cat Choupette, whom he loved during his lifetime.
[Photo by Choupette Instagram]

Inheritance of pets has also been a significant topic overseas. News that part of the 220 billion KRW estate of Karl Lagerfeld, the legendary designer of Chanel who passed away in February 2019, would be inherited by his cat 'Choupette' caused a nationwide stir in France. However, since Choupette was reportedly excluded from the final list of heirs, this is expected to remain a mere anecdote. In the United States, famous broadcaster Oprah Winfrey attracted attention by promising to bequeath hundreds of billions of KRW to her dog.

In Korea, broadcaster Lee Kyung-kyu mentioned on a show last year that he wants to leave half of his assets to his dog. He expressed his special affection for his dog, saying, "If I could, I would register all my dogs on the family register," and "I will give half of my assets to them."

Need for Improvement to Meet Pet Owners' Detailed Needs

Photo by Pixabay

Compared to advanced countries overseas such as the UK and Japan, where the pet finance market is active, the subscription rate for pet finance products among Korean pet owners is not high. KB Kookmin Bank, which introduced the first pet trust in Korea, analyzed that applying the concept of inheritance to pets is still unfamiliar and has limitations.

There are opinions that not only social awareness but also institutional improvements are necessary. There are criticisms that the supervision function for pets after the owner's death is not yet detailed enough, and calls for expanding pet supervision and care institutions are growing.

Despite these limitations, the financial sector expects the demand for pet finance to continue increasing. They are preparing to expand the pet finance market by supplementing existing vulnerabilities in pet finance products and expanding additional services.

This content was produced with the assistance of AI translation services.