What happens to Premium Bonds and NS&I when someone dies in the UK

Can Premium Bonds be inherited?

No. Premium Bonds cannot be transferred into a beneficiary's name, during the holder's lifetime or after death. They are always repaid at full face value, and the proceeds form part of the estate.

This is the point most families are surprised by. A beneficiary who wants Premium Bonds has to buy their own, in their own name, up to the £50,000 personal limit.

Registering the death with Tell Us Once does not reach NS&I. No government notification is passed on, so a prize warrant can keep arriving addressed to the person who died until someone tells NS&I.

How long can Premium Bonds stay in the prize draw after death?

Premium Bonds can stay in the monthly prize draw for up to 12 months from the date of death, in the holder's own name, if that is what the executor wants. NS&I offers this as an alternative to repaying the bonds straight away. It is a choice, not something that happens automatically, and the executor can end it at any point by asking NS&I to repay the bonds.

Premium Bonds earn no interest, so the draw is the only way the holding can grow. Other NS&I accounts carry on earning interest until they are closed.

Prizes won before the date of death belong to the estate and count in the probate valuation. Prizes won after the date of death also belong to the estate, but they fall outside the inheritance tax figure. Form IHT406 asks for the Premium Bonds and NS&I accounts the deceased held "that were in credit at the date of death", and a prize won in a later draw was not. Premium Bond prizes are free of UK income tax and capital gains tax whenever they are won.

At the end of the 12 months the bonds stop being eligible for the draw, and the holding is repaid to the estate once the claim goes through. A slow claim forfeits nothing. NS&I says of its tracing service that "there are no time limits when making a claim", and of prizes that there is "no time limit to make your claim".

Should the executor cash in the bonds or leave them in the draw?

The trade-off is speed against a modest chance of more money.

Cashing in now. Complete the bereavement claim and ask NS&I to repay the bonds. No further prizes can be won once the bonds have been repaid, and the estate can be settled sooner.

Staying in the draw. The bonds go into each monthly draw for up to 12 months from the date of death, and any prizes are paid to the estate. The principal is repaid at the end of that window, or earlier if the executor changes their mind.

For the September 2026 draw the prize fund rate is 4.35% a year, and the monthly odds of any £1 bond number winning are 21,000 to 1. The rate is an average across all holders and is skewed by the very large prizes, so most estates do worse than it implies. Run those odds across twelve draws and a £1,000 holding has around a 56% chance of winning nothing at all. At £5,000 that falls to roughly 6%, and from £10,000 up a win is near certain. So the decision splits fairly cleanly. On a small holding, keeping the estate open for a year buys a coin flip on a single £25 prize. On a holding in the tens of thousands, it is worth considering.

There is a practical cost either way. Leaving the bonds in the draw means the estate cannot be fully distributed until the last prize has been dealt with, and executors who have already paid out can find themselves reopening the estate accounts.

Do you need probate to claim Premium Bonds?

Not always. NS&I may ask for a grant of representation, meaning a grant of probate or letters of administration, where the deceased's total NS&I holdings come to £5,000 or more. It also reserves the right to ask for one at any value. NS&I confirms what it needs after it has received the completed claim form.

The £5,000 test applies to everything held with NS&I combined, not to the Premium Bonds alone. Income Bonds, Direct Saver, Direct ISA and savings certificates all count towards it. Confirm the full NS&I position before deciding anything, because other products can push the total over the threshold.

For the wider picture, see what is probate. Banks and building societies set their own release thresholds in the same way, covered in what happens to a bank account when someone dies.

How to claim Premium Bonds after death

You claim by completing NS&I's bereavement claim, online or by post. One claim covers every NS&I product the person held, so Premium Bonds are dealt with alongside any savings or investments in the same process.

The online form at nsandi.com is the faster route, and NS&I confirms you can use it "without needing to create an online account". It asks for the deceased's full name, address, date of birth, and date and place of death, along with the holder's number if you have it, your own details and authority, and the bank account NS&I should pay into. Missing account numbers are not a barrier. NS&I searches its records against the personal details you supply, and tells you afterwards what supporting documents it needs, including a grant of representation where one is required. If you post original documents, include a covering letter asking for them back by recorded delivery.

NS&I's current response time for a bereavement enquiry is eight weeks. NS&I attributes the delay to the claims process it rebuilt after the tracing failures set out in the NS&I bereavement guide, saying the "new, more robust process, introduced in January 2026, takes longer than before". It has taken on 100 extra staff and expects to be back within its usual service standards by autumn 2026. Complex cases take longer either way, including a missing holder's number, a disputed executorship, or bonds held for a child.

Need help finding and closing accounts? Legacy Trail can take the search and the notifications off your hands.

What happens to prizes after the death of a Premium Bond holder?

Prizes are paid by warrant, which works like a cheque, to the person entitled to the money. NS&I cannot pay them electronically and cannot combine several prizes into one payment.

Anything won between the date of death and the completion of the claim is held by NS&I and sent once the claim is finished. After that, each prize is sent by warrant after the draw it was won in. Where the bonds stay in the draw for the full 12 months, that can mean several warrants arriving separately over the year.

Prizes do not expire. At the September 2026 draw NS&I was holding 2,851,753 unclaimed Premium Bond prizes worth £126,787,100, and it says there is "no time limit to make your claim". Its prize checker shows the latest available draw, the last six draws and any unclaimed prizes, so an old holder's number can turn up a win from years back. NS&I also publishes the winning bond numbers for the last six draws as downloads, along with a file listing every unclaimed prize from June 1957 to March 2024.

How to trace lost Premium Bonds

NS&I runs its own tracing service, and says it "is free to use and there are no time limits when making a claim". You supply the deceased's full name and current address, any previous names and addresses, roughly when the investment was made and roughly how much. For Premium Bonds, a holder's number, an NS&I number, the bond itself or a note of when and where it was bought all help. NS&I aims to confirm any accounts or investments within a month, longer at busy times. A trace can be requested on its own, before any claim, and commits the estate to nothing. You can only request one for someone else if you are legally entitled to act for them, as an executor or under a power of attorney.

My Lost Account is the other route, and also free. It brings together the tracing schemes of UK Finance, the Building Societies Association and NS&I into a single application form, covering lost NS&I products alongside banks and building societies. Where you already have the bond or product numbers, My Lost Account tells you to approach NS&I directly instead.

With over 22 million Premium Bond holders in the UK, the sensible default in any estate is to assume some may exist. Bonds bought decades ago, gifted by a parent or grandparent, or held only on paper are easily missed. Bonds that surface after the estate has been distributed are handled like any other accounts found after probate.

What happens to Premium Bonds held for a child?

Anyone over 16 can buy Premium Bonds for a child, but NS&I requires a nominated parent or guardian, which it calls the responsible person, to look after the bonds until the child turns 16. A child can have more than one responsible person, and can hold up to £50,000 of bonds like anyone else.

If the deceased was the responsible person for a child's bonds, those bonds belong to the child and are not part of the deceased's estate. NS&I does not publish what it needs in order to put someone else in that role, so call NS&I on 08085 007 007 and deal with it separately from the bereavement claim.

Check for this during the trace. A grandparent buying bonds for a grandchild is a common pattern. Where the child is already 16 or over and managing their own bonds, nothing needs to change.