If a policyholder becomes insolvent, is there a way he can protect the policy against the creditor’s claims?
Sourabh Saxena, Bhopal
Your financial interest in a life insurance policy is an asset like any other and there are possibilities that it can be attached in the event of insolvency of the insured. However, if a policy is obtained for the benefit of the wife and children of the insured under the Married Women’s Property Act, such a policy cannot be attached in the event of the insolvency of the policyholder. The policies which are specifically assigned in favour of a creditor too cannot be attached.
