Nominee

Meaning:

A nominee is a person chosen to receive money, assets, or benefits from financial accounts if the account holder passes away. The nominee ensures that the money in bank accounts, insurance policies, mutual funds, or demat accounts goes to the right person  without delays.

Nominee – Roles and Responsibilities:  

A nominee is selected by the account holder or policyholder to receive assets in case of their death.

The nominee's main job is to look after the assets, but they are not always the final owner.

They help ensure that money and investments are transferred smoothly without legal delays.

To claim the assets, the nominee must provide valid documents like a death certificate and ID proof.

The nominee starts the claim process with banks, insurers, or financial institutions.

They act in the best interest of the legal heirs and make sure the funds reach the rightful beneficiaries.

In some cases, the nominee may become the beneficiary if allowed by law.

The nominee must keep the money or assets safe until they are legally distributed.

Financial institutions may contact the nominee for verification or updates about the account.

The nominee cannot manage or use the funds while the account holder is alive.

Importance :

Protects the family’s financial security.

Prevents disputes or confusion about who receives the assets.

Ensures quick settlement of funds after the account holder's death.

Completes financial planning by ensuring assets are passed on smoothly.

Where Nominee Is Used :   

Bank accounts

Fixed deposits

Mutual funds

Insurance policies

Demat accounts