Insurance Claims: What Happens If Both The Policyholder And Nominee Die?
Last Updated:
If both the policyholder and nominee pass away, other legal heirs can file a claim. Legal heirs usually include close family members such as the spouse, children, or parents
When taking out an insurance policy, most people name their spouse, children, or parents as nominees, with the natural intention for the claim amount to benefit their loved ones in the event of an untimely death. However, tragic situations sometimes arise where the nominee also passes away along with the policyholder.
Many times, tragic road accidents and tragedies lead to this situation where families lose multiple members together. In such cases, how can the insurance money be claimed, and who gets the first right?
According to the Insurance Regulatory and Development Authority of India (IRDAI), if the policyholder and nominee die in the same accident, the insurance company can presume that the nominee died after the policyholder. In this case, the legal heirs of the nominee are considered eligible for the claim. While final decisions may vary depending on the insurer's terms and the specific policy, this principle generally applies.
Legal Heirs Can Claim The Amount
Insurance expert Manoj Jain explains that if both the policyholder and nominee die, other legal heirs can file a claim. Legal heirs typically include close relatives like the spouse, children, or parents. If a will exists, the individuals named in it can also claim the insurance amount. The Hindu Succession Act provides a detailed order of priority for such claims.
Who Are Considered Legal Heirs?
If No Close Relatives Exist
If the policyholder has no heirs in Class 1 or Class 2, then extended family such as cousins from the father's or mother's side may claim the amount. If no legal heir is found, the insurance amount is transferred to the government.
If The Policy Was Taken By A Woman
For a female policyholder, her husband, sons, and daughters get first priority. If none of them are alive, the husband's family (parents, siblings, etc.) gets the next right. After them, her own parents come into consideration, followed by her father's and then mother's heirs. However, if the woman has left a will, that takes precedence.
Documents Required To Claim Insurance
In such emotionally and financially distressing times, knowing your legal rights and the correct claim process can offer some relief. If in doubt, consult a legal expert or financial advisor to guide you through the claim procedure.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
Business Standard
2 days ago
- Business Standard
Beware pressure tactics: Limited-time deals and fear-based appeals
This National Insurance Day, let us look at the various types of fraud that are taking place and how you can avoid falling prey to them Himali Patel Mumbai Listen to This Article A 65-year-old retired resident of Mumbai lost ₹2.36 crore to an online insurance refund scam. Fraudsters posing as officials from regulatory bodies like the Insurance Regulatory and Development Authority of India (Irdai), National Securities Depository Limited (NSDL), and National Payments Corporation of India (NPCI) contacted him via WhatsApp in November 2024, promising refunds for premiums of seven lapsed insurance policies. After paying an initial processing fee, the victim was asked to make several more payments under various pretexts. When no refund materialised, he realised in May 2025 that he had been defrauded and lodged a complaint. This National Insurance Day,
Time of India
2 days ago
- Time of India
Gold shines bright! Several life insurers want IRDAI to allow gold ETF investments; 30% returns in 12-months
The performance of gold ETFs has been remarkable, generating over 30% returns in the previous 12-month period. (AI image) Multiple life insurance companies have sought permission from Irdai to make investments in gold ETFs. This initiative follows the rising gold prices , heightened worldwide demand and the necessity to diversify portfolios, particularly when conventional investment avenues are yielding lower returns. ULIPs provide policyholders the option to distribute their investments across equity, debt and balanced schemes, based on their risk tolerance. Insurance companies are seeking Irdai's authorisation to invest 3-5% of their ULIP assets under management in gold ETFs. The performance of gold ETFs has been remarkable, generating over 30% returns in the previous 12-month period. This stands in stark contrast to the modest 5-8% returns offered by liquid debt funds, Nifty indices and conventional bank fixed deposits. "The sharp contrast in performance is pushing us to explore gold ETFs under unit-linked insurance plans (ULIPs) to improve portfolio returns and add a hedge against market uncertainty," ET quoted an insurance executive who submitted this suggestion to the regulator as saying. Gold Shining The life insurance sector presently manages assets worth ₹70 lakh crore. Following recent applications, the regulatory body has advised companies to present their proposals through the Life Insurance Council, the representative organisation for life insurers. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Estas calculadoras muestran el valor de tu casa al instante (échale un vistazo) Nation Más información Undo The regulatory body has requested a comprehensive proposal detailing potential risks and corresponding mitigation strategies. The final verdict will be made after evaluating the sector-wide submission. A favourable decision would expand insurers' investment options, providing access to an asset category increasingly recognised as a secure investment during global instability. Gold has emerged as a crucial reserve asset for numerous nations following the economic disruption caused by the Covid-19 pandemic and heightened geopolitical conflicts. Global central banking institutions have substantially increased their gold acquisitions. During 2024-25, the Reserve Bank of India (RBI) acquired 57.5 tonnes of gold, marking the second-largest yearly addition since 2017. The RBI's gold reserves grew by 35% over five years, reaching 880 tonnes at the end of FY25 from 653 tonnes in FY20. According to the World Gold Council, gold currently represents approximately 12% of India's total foreign exchange reserves, an increase from 6.86% in 2021. Additionally, insurance sector stakeholders are advocating for extended investment alternatives, requesting permission to invest in zero-coupon bonds and extended-duration corporate debt, particularly from infrastructure companies. Despite existing authorisation to invest in government securities, equities, equity derivatives and infrastructure, insurers lack sufficient long-term instruments to align with extended liability periods. Infrastructure companies typically issue five-year debt instruments, which insurers consider insufficient for their needs. The sector has requested the government to introduce 20- and 30-year sovereign zero-coupon bonds. Gold investments have yielded twenty-fold returns over the past 25 years. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
2 days ago
- Economic Times
Life insurers see the shine, seek Irdai nod to invest in gold ETFs
Life insurers in India are seeking regulatory approval from Irdai to invest in gold ETFs, driven by their impressive returns exceeding 30% in the last year. This move aims to diversify portfolios within ULIPs and hedge against market volatility, as traditional assets offer lower returns. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai : Several life insurers have approached the Insurance Regulatory and Development Authority of India (Irdai) seeking approval to invest in gold exchange-traded funds (ETFs), according to people familiar with the matter. The move comes amid increasing gold prices , growing global demand and a need for diversification as traditional asset classes deliver subdued returns. Gold ETFs have delivered returns of more than 30% over the past 12 months. In comparison, liquid debt funds, equity indices like the Nifty and traditional bank fixed deposits have offered modest returns in the 5-8% range.'The sharp contrast in performance is pushing us to explore gold ETFs under unit-linked insurance plans (ULIPs) to improve portfolio returns and add a hedge against market uncertainty,' an insurance executive who had sent this recommendation to the regulator said on condition of offer flexibility to policyholders to allocate funds across equity, debt and balanced options, depending on their risk appetite. Insurers want the Irdai to allow them to invest 3-5% of their ULIP assets under management in gold ETFs. The life insurance industry currently has ₹70 lakh crore in assets under management. In response to recent requests, the insurance regulator advised companies to route their proposals through the Life Insurance Council, the industry body representing life regulator asked for a detailed proposal with risks and proposed mitigation measures. It will take a decision after reviewing the industry-wide proposal. Its approval would widen the investment universe for insurers, offering them access to an asset class that is increasingly seen as a rewarding safe haven amid global the economic shocks triggered by the Covid-19 pandemic and rising geopolitical tensions, gold has become a strategic reserve asset for many countries. Central banks worldwide have increased gold 2024-25 alone, the Reserve Bank of India (RBI) bought 57.5 tonnes of gold, the second-highest addition in a year since 2017. Over the past five years, the RBI's gold holdings increased 35% to 880 tonnes at the end of FY25 from 653 tonnes in now accounts for about 12% of India's total foreign exchange reserves, up from 6.86% in 2021, according to the World Gold Council. Separately, the insurance industry is pushing for longterm investment options, seeking approval to invest in zero-coupon bonds and longer-tenure corporate debt, particularly from infrastructure firms. While insurers can already invest in government securities, equities, equity derivatives and infrastructure, they face a shortage of long-dated instruments to match long-term infrastructure firms issue fiveyear debt, which insurers find too short. Insurers have urged the government to issue 20and 30-year sovereign zerocoupon bonds. Over the past 25 years, gold has given a return of 20 times.
