Nomination

The nominee’s name and relationship with the life assured are given in the schedule of the policy. Section 39 deals with nomination under a life insurance policy. Sec.39(1) of The Insurance Act, 1938 (India) reads as follows, “The holder of a policy of life insurance on his own life may, when effecting the policy or at any time before the policy matures for payment, nominate the person or persons to whom the money secured by the policy shall be paid in the event of his death:

Provided that, where any nominee is a minor, it shall be lawful for the policyholder to appoint in the prescribed manner any person to receive the money secured by the policy in the event of his death during the minority of the nominee”. It should be understood that nominee has only a right to receive the claim (which belongs to the legal heirs of the life assured) and give a valid discharge to the insurer. Nomination can be changed any number of times during the term of the policy. An assignee has no right of nomination because the right of nomination rests with him “who is holder of a policy on his own life”. In policies purchased under Sec.6 of the Married Women’s Property Act, 1874  there is no provision for nomination. Nomination will be dealt in detail in a separate Post later.

Key words:

Schedule of policy
Nominee
Assignee
MWP Act, 1874