My father has nominated my elder brother as a nominee of his life insurance policy. Will my brother become the sole owner of the policy proceeds if my father dies?
Saurabh Verma, Delhi
A nominee does not become the sole owner of the policy proceeds if the policyholder dies. The life insurance proceeds in case of death of the policyholder pertain to his legal heirs or beneficiaries. As per law, a nominee is just entitled to give a valid discharge to the life insurance contract and receive the proceeds on behalf of the legal heirs of the insured. A nominee may or may not be a beneficiary and is not entitled to hold the proceeds as his estate. Your elder brother will have to give a valid discharge to the life insurance policy in the event of your father’s death and the policy proceeds shall be divided among all the legal heirs of your father as per his will.
