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Settlement of Claims

Operational Procedure for Settlement of Claims of Deceased Depositors and Return of Articles in Safe Deposit Lockers/Safe Custody

Chapter : 2

I. Settlement of claims - Deceased Depositors- applicable for amount more than threshold limits ( i.e. more than Rs.2 lacs at present)

1. Access to balance in deposit accounts

(A) Accounts with survivor / nominee clause

In the case of deposit accounts where the depositor had utilized the nomination facility and made a valid nomination or where the account was opened with the survivorship clause ("either or survivor", or "anyone or survivor", or "former or survivor" or "latter or survivor"), the payment of the balance in the deposit account to the survivor(s) / nominee of a deceased deposit account holder represents a valid discharge of the bank's liability provided :

  • The identity of the survivor(s) / nominee is well established and the fact of death of the account holder, through appropriate documentary evidence is produced;
  • There is no order from the competent court restraining the bank from making the payment from the account of the deceased; and
  • It has been made clear to the survivor(s) / nominee that he would be receiving the payment from the bank as a trustee of the legal heirs of the deceased depositor, i.e., such payment to him shall not affect the right or claim which any person may have against the survivor(s) / nominee to whom the payment is made.

Since payment made to the survivor(s) / nominee, subject to the foregoing conditions, it would constitute a full discharge of the bank's liability, insistence on production of legal representation is superfluous and unwarranted. In such case, therefore, while making payment to the survivor(s) / nominee of the deceased depositor, the bank will not insist for production of succession certificate, letter of administration or probate, etc., or obtain any bond of indemnity or surety from the survivor(s)/nominee, irrespective of the amount standing to the credit of the deceased account holder.

(B) Accounts without the Survivor / Nominee clause

For deposit accounts with operating instruction singly, jointly, joint account with mandate “either or survivor”/”Former or Survivor”/ “Any one or Survivor”/ with or without Nomination process is given at part 3 of chapter 1. Requirement of documents are as per check list given at para-4 of this chapter.

General Guidelines

i. Payment against Legal Representation
  • In regard to payment of balances in the accounts of deceased customers to survivors/ claimants, the branches may call for succession certificates from legal heirs of deceased depositors in cases where there are disputes and all legal heirs do not join in indemnifying the bank or in certain other exceptional cases where the branch has a reasonable doubt, about the genuineness of the claimant/s being the only legal heir/s of the depositor.
  • When all the heirs are ready to sign claim form and indemnity bond, branch may not insist for succession certificate.
  • The above guidelines are also applicable in respect of other assets like articles kept in the Banks, securities held against advances after adjustment thereof, if any, etc. of the deceased customers to legal survivors / claimants.
Premature termination of term deposit accounts

"In the case of term deposits, in the event of the death of the depositor, premature termination of term deposits would be allowed. Such premature withdrawal would not attract any penal charge".

Treatment of flows in the name of the deceased depositor

In order to avoid hardship to the survivor(s) / nominee of a deposit account, bank will obtain appropriate agreement / authorization from the survivor(s) / nominee with regard to the treatment of pipeline flows in the name of the deceased account holder. In this regard, bank will consider adopting either of the following two approaches

  • The bank could be authorized by the survivor(s) / nominee of a deceased account holder to open an account styled as 'Estate of Shri ________________, the Deceased' where all the pipeline flows in the name of the deceased account holder could be allowed to be credited, provided no withdrawals are made.
  • OR
  • The bank could be authorized by the survivor(s) / nominee to return the pipeline flows to the remitter with the remark "Account holder deceased" and to intimate the survivor(s) / nominee accordingly. The survivor(s) / nominee / legal heir(s) could then approach the remitter to effect payment through a negotiable instrument or through ECS transfer in the name of the appropriate beneficiary.
Time limit for settlement of claims

Bank will settle the claims in respect of deceased depositors and release payments to survivor (s)/ nominee in case of accounts with survivor/ nominee within a period not exceeding 15days from the date of receipt of the claim subject to the production of proof of death of the depositor and suitable identification of the claimant(s), Legal representation where ever applicable (e.g. in case of dispute), legal heir certificate to the bank's satisfaction. In the case of accounts without survivor/ nominee clause the claim should be settled within 1 month from the date on which the requisite documents have been submitted.

Access to the safe deposit lockers / safe custody articles

For dealing with the requests from the nominee(s) of the deceased locker-hirer / depositors of the safe-custody articles (where such a nomination had been made) or by the survivor(s) of the deceased (where the locker / safe custody article was accessible under the survivorship clause), for access to the contents of the locker / safe custody article on the death of a locker hirer / depositor of the article, the bank will adopt generally the foregoing approach, mutatis mutandis, as indicated for the deposit accounts.

Check List of formalities to be completed for Deceased Claims

Deposits
Payment of balance in the account of the deceased accountholder

Payment of balances at the credit of deposit account/s of deceased person/s in case of single account or in case of death of all joint accountholders in case of joint accounts, may be made to their legal heirs/nominee on the basis of –

I. Nomination
II. without Nomination
(A) .Against Indemnity letter / Bond
(B) Legal representation

I. Nomination:
  • (i) Where a depositor dies or, in case of a joint account, all depositors die, the nominee or the person appointed by the depositor(s) to receive the payment on behalf of the minor nominee, should make an application for repayment of the deposit amount in the Bank's Form No.352, duly filled in, along with a copy of the death certificate, duly certified by,
  • (a) a Magistrate or Judicial Official OR
  • (b) an Officer of the Central or State Government OR
  • (c) an Officer of a bank OR
  • (d) two persons acceptable to the bank.
  • (e) Proof of identification of nominee (s) such as Election / Pan card, Passport, Aadhaar letter etc.
  • (f) Stamped receipt for amount received signed by nominee / person on behalf of minor nominee
II. without Nomination I without Survivor clause
A. Against Indemnity
Documents required:
  • Death Certificate ((Duly certified as mentioned in I (i)
  • Claim application in the prescribed form (Form no.33 )and surety letter, consent letter of all other claimants.
  • Credit reports on claimants, sureties (two) in the prescribed form no.135.
  • Worth of surety should cover the claim amount.
  • Letter of Indemnity in the prescribed format duly executed on stamp paper (stamp duty as applicable from time to time in the state of execution as per state enactment) by all the claimants and sureties.
  • Proof of authority of legal heirs.
  • Stamped receipt signed by claimant /s for amount received.

B. Against Legal Representation

Documents required
  • Death Certificate (Duly certified as mentioned in I (i))
  • Claim application in the prescribed form no.33
  • Legal representation i.e. succession certificate or letter of administration or probate of Will granted by competent court.
  • Stamped receipt for amount received.

Copy of all documents should be submitted with original for verification by branch official and all documents should be signed in presence of branch official.

II. Settlement of Claims in respect of Missing person ( Above threshold limits at present Rs.2 lacs)
A. Settlement of claims where a person is missing for the last 7 years & more and where order from competent court is produced

In a situation where an individual has been missing for 7 years or more and if the nominee / legal heirs/ produce the declaration of the Court that such an individual is presumed to be dead (civil death) then, such person’s account may be treated as of the account of a deceased person. In such cases, when a declaration as aforesaid is furnished, the same will tantamount to the death certificate and it would be in order for the Bank to proceed on such declaration to settle the claims in respect of such missing person’s accounts.

The Credit balance in the deposit account up to any extent may be settled on the basis of submission of claim by the nominee/legal heirs/ enclosing Whether order or Certificate/declaration, Of the competent court and on the basis of identification of the nominee / legal heirs/ claimants the credit balance together with interest, if any, may be paid by cheque or to their account maintained with us or through NEFT/RTGS if account maintained with the other bank.

The branch official should visit the residential premises of the account holder and make discreet enquiries about him/her and report to be kept on branch record. The matter should be reported to next higher authority for PSR.

Click here to download formats to be filled in by claimants

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