I am 45 years married with a daughter and reside in Chikkamagaluru. My brother and his wife passed away in an accident last week in which their car was totally destroyed. They have no children. My brother made me the nominee of his term life insurance plan. When I lodged the claim with the insurer, they asked me for a legal certificate. What should I do?
As per new insurance rules, the concept of beneficial nominee has been introduced. A beneficial nominee is the spouse, child or parent of the insured. On death of the insured, the beneficial nominee becomes the ultimate beneficiary of the proceeds, irrespective of other legal heirs to the deceased’s estate. Nominees other than beneficial nominees are only the custodian of the legal heir. Insurers are expected to pay the claim to the nominee. 1. If the nominee is a beneficial nominee then they retain the money otherwise it is their obligation to distribute to the legal heirs. 2. There is no reason why the insurer is asking you for the legal heir certificate, particularly if the nomination is clearly stated. If you do have this certificate, please share it with the insurer, but if you don’t then do explain that it is not mandatory.