Nomination in Life Insurance
Provision of Nomination in Life insurance is related to Section 39 of the Insurance Act. According to the above Section, Nomination is such a right given to the Life insured by whom he may nominate any person in his life insurance policy. The nominee will have the right to claim the Sum Insured if the death of the Life insured occurs during the policy term.
When the policy money becomes due for payment on the death of the policyholder, it can be paid only to the person who is legally entitled to give a valid discharge to the Corporation. For quick settlement of claims, it is in the interests of the policyholders to effect a nomination in respect of their policy.
What Is the Procedure to Choose a Nominee for Life Insurance
In order to choose a nominee for your life insurance policy, you should follow these steps:
- Consider who you want to name as the beneficiary of your policy. This could be a spouse, child, parent, or other close relative or friend.
- Consider the financial needs and responsibilities of the beneficiary. You may want to name a beneficiary who is financially responsible and can use the proceeds from the policy to pay for your funeral and other final expenses.
- Review the terms of your policy. Some policies may have restrictions on who can be named as a beneficiary, so it’s important to make sure that the person you want to name is eligible.
- Contact your insurance company or agent to discuss the process for naming a beneficiary. They will be able to provide you with the necessary forms and instructions for completing the process.
- Fill out the necessary forms and return them to your insurance company. Be sure to follow their instructions carefully to ensure that the beneficiary designation is properly recorded.
- Review and update your beneficiary designation on a regular basis. Life events such as marriage, divorce, birth of a child, or the death of a beneficiary may affect your beneficiary designation. It’s important to review and update it as needed to ensure that it reflects your current wishes.