There is at least one life insurance policy in each home, and an insurance salesperson will call you every day asking if you’d like to buy a new life insurance policy. There has been a growing variety of term insurance schemes on the market due to an increase in the number of providers. The characteristics of each term policy scheme are different from one another. This means a nominee should know term insurance to enable the correct settlement of claims.
In this article, we will understand the nominee, its importance, and the need for the nominee in the life insurance policy. So let’s move ahead and deeply understand what a nominee must know about the life insurance policy.
Who is a nominee in an insurance policy?
A nominee is a person who holds the property of the deceased until he has to distribute it to the legal heirs. The recipient of a life insurance policy is the person to whom you must consent to benefit from its proceeds following an accident. A policyholder can designate more than one beneficiary and indicate their part in the proceeds of the policy.
What is the requirement for an insurance nomination?
In the case of a life insurance policy, the nomination is compulsory. In the event of a policyholder’s death, an insurance provider will no longer be able to make any transfer of policy proceeds unless they are appropriately nominated. You should select the dependents eligible to claim your death as the beneficiaries of your life insurance.
Any person who the policyholder has elected may be a nominee. A nominee doesn’t need to be the policyholder’s spouse, child, or parent. During the establishment of insurance, policyholders should provide adequate details on their nominee, or it will be difficult for him to receive a settlement payment.
5 Things a nominee has to Know of life insurance policy
A term life insurance policy is an arrangement between the holder and the insurer. This means that policyholders and insurers are the only ones who deal with most communications. There are certain things you should know as a candidate.
1. Make an accurate understanding of the term policy
This benefit is guaranteed if the insured has chosen a whole-life policy. It means there is no policy tenure. The maturity value will be assigned to the nominee by the insurer at the time of the policyholder’s death. You will only receive the claim amount in a term policy if the beneficiary dies during the policy term. That’s the critical information that should have been known to you as a policy candidate.
The policy’s benefits, premium amount, rate of maturity, etc., must be kept in mind. This knowledge will allow you to gain an advantage in the settlement process and avoid delays.
2. Make sure you know what’s involved in the claim process.
The process for settling claims involves several steps. You’ll need the death certificate of your policyholder, medical records, insurance documents, and so on. You can understand the entire process well. Ensure you’ve obtained a valid death certificate and keep it safe if you know there will have to be a valid death certificate for the claim to be accepted. Ensure they have been informed about the claims procedure when multiple beneficiaries are on a term insurance policy. The proper documents should be available to all of them for settlement.
3. Verify that all of your information is correctly filled in
Check the name, address, age, date of birth, etc. Official documents, such as an Aadhar card, birth certificate, passport, etc., shall be compatible with the information supplied in your nominee application. It is of vital importance for the disbursement of claims.
4. Keep in touch with the policy
If you are a nominee, you should also check that the insured pays the premiums on time. It will affect the payment of claims if the compensation has not been paid. The guarantee amount should also be checked for adequacy concerning your expenses. If not, you should ask the insured to increase the guarantee amount and adjust the premium accordingly. You’re supposed to monitor the policy and be a part of the insurance process.
5. Have all the relevant contact information
Insurance is purchased by an agent most of the time. You should keep the contact details of an agent on your mobile if you are a nominee. Have the insurance officer’s number saved if the policy was opened directly. These are vital contacts in the event of an emergency. They know your policy details and help you file the claim immediately.
Suppose you are a policyholder of any kind of policy. In that case, you should be aware of all the key factors mentioned above in this article that claim your policy on any type of emergency. If you are looking for a life insurance policy, consider going ahead with Aditya Birla Sun Life Insurance Policy. Aditya Birla Sun Life Insurance will help you to meet your financial and protection needs by providing a life insurance plan for each of your goals in life.
ABSLI is one of India’s leading life insurance companies that offers a wide range of product lines throughout the customer’s lifetime, e.g.