How Nominee Can Get Death Benefit Money on a Policy?

Life Insurance policy provides financial security and support to you and your family. It helps the insured to secure his/her family financially in his/her absence on the unfortunate demise of the insured. The life insurance policy offers a death benefit to the insured’s chosen nominee on the death of the insured during the term of the insurance plan. The death benefit is a lump-sum benefit which is paid to the nominee of the insurance plan and is exempted from Income Tax under section 10(10D) of the Income Tax Act.

Who is a nominee?

A nominee is a person who is appointed by the life insured who receives the death benefit of the life insured plan in case of the death of the life insured. The nominee is not necessarily required to be a relative of the life insured. The nominee can only be appointed by the life insured and not by the policyholder. The nominee of the Life Insurance policy is required to follow the mandatory procedure to receive the insurance claim.

Facts to know about Nominee

1. The nominee can be changed by the life insured during the term of the insurance policy
2. It is not necessary to have a blood relation to be a nominee. Even a bank or a financial institution or a charitable trust can be chosen as a nominee by the life insured to which the death process will be paid. 
3. The life insured can also appoint more than one nominee for their life insurance plan. In case pf more than one nominee the life insured has to state the proportion percentage to be paid to each such nominee. If the life insured does mot mention the proportion to be received by such one or more nominee, the proceeds will be paid equally to all of them. 
4. If the nominee is a minor child, in that case, an appointee will have to be appointed who will collect the money on behalf of the nominee till the nominee is a minor. But once the nominee is 18 years of age, the appointee will be removed and the child will be full force nominee of the insurance plan

Process of Death Claim by the nominee of the Life Insurance Policy

The claim process of death proceeds in a life insurance policy to be followed by is a nominee is very simple if the nominee possesses relevant required documents. The simple process of death claim by the nominee of the life insured plan is stated hereunder: 

1. The nominee is required to inform the insurance company or the insurance agent as the case may be about the death of the life insured as soon as possible. The intimation of the claim should carry information such as date of the death of the life insured, place of death and the cause. However, the claim intimation can be done by any person or relative of the life insured even if he/she is not a nominee of the plan
2. After the intimation of the death of the life insured, the nominee is required to fill in a death claim form with relevant details and submit it with required documents which include death certificate of the life insured, original policy document, discharge form, deed of assignment, identity proof of the nominee. The death claim form can be downloaded online or can be collected from the branch of the insurance company. 
3. The nominee is also required to furnish his/her bank account details. 
4. In case of accidental death or death due to any other causes other than natural causes, a police complaint is also required to be filed with the police. The nominee is also required to submit police FIR report, punchnama, police inquest report along with the death claim form and death certificate. 
5. The insurance company verify the death claim of the insurance plan. It may ask for additional information or documents which are to be provided by the nominee. If the insurance company is satisfied that it is a valid claim will pay the death claim amount to the nominee by crediting it to the bank account of the nominee. 

Documents required for Death Claim Settlement

Generally, the nominee is required to submit the following stated documents for a death claim in a life insurance policy:

1. The death certificate of the life insured
2. ID proof of the nominee of the insurance plan
3. Original policy document
4. Age proof of life insured
5. Discharge form
6. Medical certificate as proof for the cause of insured’s death
7. Police FIR ( in case of accidental or unnatural death)
8. Post mortem report of the insured ( in case of accidental or unnatural death)
9. On the death of the life insured due to an illness, hospital certificates/ records are also to be submitted
10. Employer certificate and cremation certificate in case of the early death of the life insured 

Conclusion

The nominee should make the insurance claim of the insurance policy as soon as possible following the death of the life insured and also ensure that they have all the necessary documents with them which are required for the settlement of the claim. In case of absence of any nominee in the life insurance plan, the claimant can make the claim request and receive the death proceeds at the option of the insurance provider and on the satisfaction of necessary requirements.