Updated: Jul 10, 2023
The Pour-Over Will is the Last Will to provide backup on the assets left out from Trust or Waqf. It's a popular estate plan and strongly recommended to create side by side with Trust or Waqf. In the absence of a Pour-Over Will, any property not covered under Trust will have to administer under the Intestacy rule of the country, which is what no one wishes to be taking place because it will be an expensive deal in terms of time and cost. The aim of having a Pour-over will may differ from one situation and person to another. The Pour-Over Will is a new concept and still evolving. The three typical types of Pour-over Will: (1) Pour-Over Will as a backup, (2) Pour-Over Will for transferring assets left out from Trusts, and (3) Last Wills and Trusts as separate estate plans that do not pour over to each other. Wassiyyah offers and recommends creating the first type of Pour-over Will called "Pour-over Will as a backup."
The Pour-over Will is a legal document protecting assets left out of Trust or Waqf. It's much similar to typical Islamic Will. However, it should cover the most to protect assets and inheritors. People usually miss out on this vital documentation by negating necessity in the presence of Trust. Since the Trust agreement is a live document and may require updating from time to time, there is still a chance that it may not get updated before death, and essential assets owned before death may be missed out. That's where the necessity of Pour-Over Will is clearly experienced. Wassiyyah strongly recommends creating this document with Trust as a backup document.
The Pour-Over Will can function for transferring assets to Trust. This was not allowed in the past, but some countries like the USA allow the Pour-Over Will as a transferring mechanism. In this option, if it functions as expected, then one of the greater benefits is privacy. Assets under Trust are always kept private and do not become public similar to Wills. This option allows centralizing assets in one place, but there are main restrictions and reasons why Wassiyyah does not offer and recommend this type of Pour-Over Will.
This transfer of assets from Pour-Over Wills to Trust may or may not allow depending upon the country or jurisdiction (i.e., state, province, or territory) you live.
You must have a fully established Trust; otherwise, it creates administrative and legal issues in transferring assets from Trust to Pour-Over Wills. If Trust is in non-active or non-established status when transferring, it will not work as you wish.
Assets transfer from Pour-Over Will to Trust may take some time as it will require altering the agreement. Any amendment in the Trust agreement would not be easy, especially when the Trust's Grantor dies and amendments to be done by the Trustees. It may end up in more effort than simply administering Wills separately.
Wills does not cover only assets but guardianship of minors. So, those still need to handle through Wills. So, assets would transfer, and remaining guardianship-related affairs those would be administered under Wills, so you can not fully centralize your estate planning documentation.
The assets under Pour-Over Will must go through Probate even if transferred to Trust. So, it may incur delays.
This type is not a Pour-Over Will because of treating Trust and Wills separately. Neither assets from Trust poured over to Wills and vice-versa in this type. Some people prefer to keep some assets under Trust while remaining in the Last Wills. For example, some of the assets in investment for liquidity need flexibility of changing that can be more easily handled through Last Wills than Trust. The reason is that any changes you make in the assets must reflect in the Trust. On the other hand, Last Wills does not need to be updated for any asset or investment changes. Wassiyyah does not offer and recommend this type of Will because of the following reasons.
You need a backup for your assets left out of Trust. Treating Trust and Wills separately can require more management than any other options mentioned above.
Trust needs continuous updating if any assets are changed, so any assets missed from Trust can end up in Intestacy.
In all the above options, assets covered under Pour-Over Will must go through probate irrespective of your situation so that delays may incur. However, the larger portions of estates will be covered under Trust, the probate process may not require as much time and cost compared to not having Trust. Having Trust and Pour-Over Will in place will surely provide greater tax benefits and less legal processing time.
Wassiyyah will provide a detailed step-by-step guide and more information when you create Pour-Over Will.