Buying insurance? Here's why filing accurate nominee info is a must
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- 2 of 5Who 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.
- 3 of 5What 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.
- 4 of 5Changing a NomineeIf 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.
- 5 of 5Provide Specific DetailsInsurers 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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