• Insurance payment

My elder brother met with an accident and passed away. He has nominated mother, who is a widow, as his nominee for getting the insurance amount from LIC. He has his wife, a son and a daughter living separately.
Please let me know to whom the LIC has to disburse the insurance amount in full and whether my mother can utilize the entire amount without sharing with his (my brother) family members legally.
Asked 7 years ago in Family Law
Religion: Hindu

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8 Answers

on brother demise mother , widow , son and daughter would be legal heirs

2) nominee is only trustee for legal heirs

3) your mother has to share amount received by her with other legal heirs

Ajay Sethi
Advocate, Mumbai
95168 Answers
7604 Consultations

5.0 on 5.0

mother cannot keep the full insurance amount received by her

it has to be shared with brother wife and their children

Ajay Sethi
Advocate, Mumbai
95168 Answers
7604 Consultations

5.0 on 5.0

1. If a valid nomination in favour of the mother of the insurer is made then LIC is bound to disburse the benefit in her name.

2.However if there is a future dispute with money and his widow has raised objection then unless an order is obtained from court the LIC may withhold the money.

3.The nominee is a mere trustee of the money and on receipt of the insurance money the mother is bound to equally divide the said money into 4 part e. each belonging to her , widow and the two children.

Devajyoti Barman
Advocate, Kolkata
22917 Answers
497 Consultations

5.0 on 5.0

As i advised earlier the mother is only entitled 1/4ths sahre while 3/4th belongs to his widow and two children.

So get back the due share any of them can apply for succession certificate.

Devajyoti Barman
Advocate, Kolkata
22917 Answers
497 Consultations

5.0 on 5.0

Please let me know to whom the LIC has to disburse the insurance amount in full and whether my mother can utilize the entire amount without sharing with his (my brother) family members legally.

Section 39 of the Indian Insurance Act, 1938, provides for nomination of a person (called nominee) who gets the benefits of the policy on death of the person whose life has been insured.

Nominee is statutorily recognized as a payee who can give valid discharge to the Insurance company for payment of policy money without the hassles of establishing the title to receive the same, in case of death of life assured before expiry of the term of contract.

Nomination merely gives the nominee the right to receive the policy moneys in the event of death of the life assured. The nomination does not pass the right of the property in the policy to the nominee.

Nominee is answerable to all the natural heirs left by the deceased, in case of rival claim is lodged by other natural heirs.

Thus the nominee in the Insurance laws can be considered as a trust to receive policy monies on behalf of the legal heirs and is responsible to disburse them to all the legal heirs of the deceased life assured.

T Kalaiselvan
Advocate, Vellore
85369 Answers
2231 Consultations

5.0 on 5.0

Please answer clearly.

In accordance with Sec 39 of the Insurance Act,1938, the holder of a policy of life insurance on his own life, may, when effecting the policy or at any time before the policy matures for payment, nominate a person or persons to whom the money secured by the policy shall be paid in the event of his death.

Nominee is statutorily recognized as a payee who can give valid discharge to the Insurance company for payment of policy money without the hassles of establishing the title to receive the same, in case of death of life assured before expiry of the term of contract.

Nominee is answerable to all the natural heirs left by the deceased, in case of rival claim is lodged by other natural heirs.

Nomination merely gives the nominee the right to receive the policy moneys in the event of death of the life assured.

T Kalaiselvan
Advocate, Vellore
85369 Answers
2231 Consultations

5.0 on 5.0

But still they are delaying the process of the payment to my mother. How to speed up the process. Further my brother's wife demands for 50:50 amount from the insured amount. My mother has no income and she is struggling to get the payment.

The nomination enables the nominee to receive the policy proceeds without necessity of producing any legal evidence of title to the estate of deceased life assured. but such nominee is liable to account for the moneys to all legal heirs of the deceased life assured.

Since there are rival claimants, the insurance company may not be in a position to settle the policy money if there is a restriction by an order of court.

Moreover the process of settling death claim involves many aspects including inquiry or claim investigation (if it is an early death claim).

If there is an inordinate delay in settlement of death claim then you may call on the office of the insurance company and personally clarify the reasons for delay in settlement.

If you do not get proper response then you may contact Customers relation manager who will be available in the divisional office or manager claims or marketing manager or senior divisional manager.

Your grievances will be properly addressed by any one of the authorities mentioned above.

T Kalaiselvan
Advocate, Vellore
85369 Answers
2231 Consultations

5.0 on 5.0

your mother should agree for equal division of the insurance money to be received by her

2) even if your mother goes to court she would not get the full amount as she is only trustee for legal heirs

Ajay Sethi
Advocate, Mumbai
95168 Answers
7604 Consultations

5.0 on 5.0

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