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Buying insurance? Here's why filing accurate nominee info is a must

  • Myinsuranceclub.com
  • Apr 13, 2013, 11:11 AM IST
Buying insurance? Here's why filing accurate nominee info is a must
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The author, Deepak Yohannan, is the CEO of MyInsuranceClub.com, an online insurance price & features comparison portal. For more articles by Yohannan, visit MyInsuranceClub.com. You may write to the author at Deepak@myinsuranceclub.com
 
Death catches even the most prepared of us off-guard. Indeed, there is no escaping the eventuality of death. Earning members of families, however, must provide for their near and dear ones in the event of their passing. And life insurance policies help you do just that. 
 
A disciplined savings regimen over several years is all it takes to ensure that your dependents do not want for money or the basic comforts once you are no more. 
 
Year after year, you pay regular insurance premiums – never a delay, never a missed payment. You keep all the papers in place, where your loved ones have easy access to them. Everything is in order, so that in the event of your passing, your family will not have to stress about receiving payment from your insurer. After all, they should not have to run around doing paperwork while they grieve for you.
 
That is why it is so important to file nominee details accurately. This helps ensure that your family members receive the insurance payout in a timely and hassle-free manner. A single error could lead to payment delays and mental stress regarding the insurance amount. This is more prevalent in cases of NRIs and HNIs, because most nominees are not even aware of the assets in their names. In such cases it is even more important to file correct details.

 

Find out more by clicking on the following slides

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    Buying insurance? Here's why filing accurate nominee info is a must
    Who Is a Nominee?

    When buying insurance, the policyholder is required to designate someone to receive the proceeds when the insurance policy pays out following the former's death. The person who receives the payout is called the nominee.

    Most policyholders appoint their legal heirs as their insurance nominees. However, this need not always be the case. The nominee need not be related to the policyholder.

    However, in such a case, the policyholder may be required to prove that the nominee will be financially affected by his/her death.
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    Buying insurance? Here's why filing accurate nominee info is a must
    What Details Are Required?
     
    The policyholder is required to furnish the following details about the nominee: full name, address, date of birth and identity card or birth certificate number. If you have more than one nominee, provide each of their details exactly. 

    Is your nominee a minor? In that case, you will have to appoint an adult to receive the claim on the child's behalf. The appointee's particulars must also be provided in full.
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    Buying insurance? Here's why filing accurate nominee info is a must
    Changing a Nominee
     
    If your nominee passes away before you do, you will have to designate another nominee to claim the payment on your insurance. The insurer could reject or delay your family's claim later on, if no nominee is mentioned in your policy.

    People change nominees for various reasons. For instance, single women usually nominate their parents first. On getting married, they may nominate their husbands. Later on, their children may become the nominees. Each time you change a nominee, make sure to furnish the correct details.

    In case your nominees move to a different home, furnish your insurer with the changed address details.
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    Buying insurance? Here's why filing accurate nominee info is a must
    Provide Specific Details
     
    Insurers sometimes nominate their "wife and children" without providing specific details. If you want to ensure quick claim settlement, provide the names and other particulars of each individual nominee separately.
     
    Taking the time to provide accurate nominee details to your insurer will stand your loved ones in good stead after you are gone. They will not have to run from pillar to post to get what is rightfully theirs.

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