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Why is it necessary to make a nominee?
If an account holder has nominated all his financial accounts, then in the event of his death, all the money will go to the nominee. If you have made more than one nomination, all of them will get the same amount. Many people provide the facility of multiple nomination. Also, you can decide how much share to give to which nominee. This method is also very good, because it reduces the possibility of family disputes later on regarding the division of money.
If there is no nominee then who will get the money?
If a person has not made a nomination for a bank account, the money will go to his legal heirs after his death. In the case of a married person, the legal heirs are the wife, children and parents. Also, the parents or siblings of an unmarried person can also claim the money.
How will I get the money if there is no nominee?
If the account holder has not nominated anyone, then the money will be deposited in the account of his legal heir. For this, the legal heir will have to bring some important documents. These will require death certificate of the deceased, photograph of the legal heir, KYC, disclaimer letter Annexure-A, compensation letter Annexure-C.
Disadvantage of not having the name of the nominee in the bank
In case of death of the account holder the account can be closed and the money can be deposited in the government treasury.
Without a nominee, heirs may dispute who will own the account upon the death of the account holder.
The process of proving legal succession can be a waste of time and money.
Without a nominee, on the death of the account holder, the legal heirs may have to pay tax on the money in the account.
Making an insurance claim without a nominee can be difficult as the insurance company will not have information about the nominee.
Claiming pension and other benefits may also be difficult. Court action may also have to be taken.