When a person dies, the family expects that their savings, insurance, PF, FD or bank account amount will come directly to them. Often the deceased has appointed someone as a nominee.
In such a situation, everyone assumes that the nominee will get the property of the deceased. But does this really happen? Does becoming a nominee make that person legally entitled to the property? Let’s know what the law says.
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What and who is a nominee?
First of all, let us understand who is a nominee. When we open a bank account, invest in PF, LIC or mutual fund , we have to name a nominee. This means that if the account holder dies, the amount related to that account will be given to the nominee first. But this does not mean that the money or property belongs to the nominee. Actually, the nominee is only a trustee, that is, a responsible person to whom this amount is given temporarily, so that he can deliver it to the real beneficiaries.
Who is the real owner of the property?
Now the question arises- who is the real owner of the deceased’s property? The answer is- the person who is either named in the deceased’s will, or the heir decided on the basis of the succession law. For example, according to the Hindu Succession Act, 1956, after the death of the husband, his wife, son-daughter, parents etc. are his heirs. If no will is written, then the property is divided like this.
What does the law say? Know here
Indian law is quite clear on this subject. Under Section 39(7) of the Insurance Act, the insurance company is liable to pay the sum insured to the person who has been legally appointed as the nominee. But this does not mean that the sum becomes the property of the nominee himself. In fact, the nominee holds the sum as a trustee for the legal heirs of the deceased.
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