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  • Category: Investments

    Bank account and insurance claim nominee

    Have a query about insurance claim? Searching for details online? Find responses from experts here which may resolve your query.

    I have a FD in my name in a joint account with my father, step mother and grand mother. My father passed away last year because of heart attack. He didn't write any legal will. However I found a piece of paper in which he had written that all his bank accounts and other assets have to be transferred in me and my sister's name after his death. The FD solely carries my name and is not matured yet.
    Therefore,my question is:
    Am I bound to share the FD amount with my sister (unmarried) and step mother according to Indian law or I can take it all by myself as it was in my name?
    I have an insurance policy that my father opted in my name as a nominee i.e in case of his death the amount has to be given to me and I have received the money. So for the money that I received am I bound to share it with step mother and my sister or is it my choice to share it according to Indian Law?
  • Answers

    5 Answers found.
  • As the FD is in the name of all the members jointly so you are bound to share the money with them. If the FD has a nominee name then the claimed amount would be given to him/her. If you are the nominee you can get it after producing death certificate and succession certificate as a proof that you are the legal heir of your father. After you get the money it is completely up to you whether you share or not.
    For your second question the answer is same, if you are the nominee you will get the amount. Now if you wish you can give it to your step mother and sister. There was no bound for doing that.

  • If you are the nominee for insurance policy, as per IRDA, you are eligible to get the full settlement money. As per law you need not share it with anybody. No body has the right to question you. It is your will and wish, if you want share with them.

    Coming to FD, as FD is on your name, it your money only. At the time of maturity you are entitled to draw that money. No need to share with anybody.

    In my opinion whatever is written on the paper may not be valid . All legal heirs are eligible for the money.

    always confident

  • At one place you have written
    "I have a FD in my name in a joint account with my father, step mother and grand mother"
    At another place you have written "The FD solely carries my name and is not matured yet."
    What is the correctly position? Is it that the FD receipt or the FD ledger account in the bank, bears name of all four i.e you, father, stepmother &grandmother? Or is it only in your name?
    I shall take this question first legally and technically; then I shall take it from the moral or ethical side.
    Legal & technical side:

    Situation 1. FD ONLY in your name

    If the FD is ONLY in your name, the bank will give the amount on maturity to you only. If it is only in your name you can even close it before maturity.

    Situation2: The FD is in the name of all the four :

    Then the bank will see what is the operation instruction-former or survivor, jointly etc. If it is former or survivor, the all the remaining three will get it jointly on requesting and signing jointly. They may even credit it to a joint account in all your three names. If there are no special instructions then the bank will give the amount to you three and any other living legal heirs of your father jointly on putting up a 'claim'. All the claimants have to submit proof of their claim right and identity proof. If the amount is large then there are some more procedures. First of all you have to submit the death certificate copy to the bank and get that noted in the FD records and any other accounts he is having in that bank.
    If the FD has joint names , but still there is a nomination signed by all the joint holders, then nominee can claim the amount and bank will give the amount to nominee on identification with proof.However if the bank gets objection from any of the joint holders before giving the amount to nominee, they will stop that and freeze the money until things are cleared by all those involved or by a court order.

    Insurance claim amount: Legally you need not share the amount with anyone as you are the nominee.

    (However in all these case if anyone is taking up the matter in a case in court, then the same is subject to court order)

    Ethical and moral side:

    If the money is fully your father's earnings , then the proper way is to get the money of FD and insurance and divide the total among all the four equally; namely, yourself, your sister, your step mother and grandmother. Or you can come to a mutually consulted and considered understanding acceptable to all. If the amount is large it is better to put the understanding in writing in a stamp paper (agreement) with a common witness and all you four should sign and keep a copy each. You can keep the proof of having distributed the money as per understanding, along with the agreement.

  • As your father has not made a registered will you have to go by the names in which FD and insurance policies are made.

    The paper on which your father has written something has no legal sanctity.

    Ethically if you know what was your father's intention, follow that.

    If FD is in joint names than you have to see its mode of operation whether you alone can encash it or require multiple signatures for encashment.

    Law is one thing but in such cases conscience is the main thing and one should honour that.

    Knowledge is power.

  • As far as the FD is concerned, your question is confusing. However, It the FD was made in the joint names of your grandmother, stepmother and yourself, common sense says that the proceeds would be equally divided between/among the surviving ones. But has the FD matured?

    I don't think there is no legal validity what your father had written in a paper (without any signature of himself and without any witness).

    So far as the insurance policy is conerned, the nominee, i.e., you (accoring to your version) will receive the amount once you submit the death certificate to the insurance office.

    Beware! I question everything and everybody.

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