Settlement of Death Claims by Banks

This post is meant to help those who are having an account with the Banks. This post will generally explain how most of the Banks; either Public or Private, are settling Death Claims.

First we will see what a Death Claim is. In simple words, claiming money/amount in an account by the legal heirs of the deceased account holder is a Death Claim. The account holder may hold different types of accounts. The nature, amount, operational condition, etc may vary. Banks follow almost similar method in settling the claim application submitted by the claimants. According to the nature and other things, certain requirements will vary.

When a claim application will arise

A Claim Application will rise when there is no nomination registered with the account. If the nomination is registered in the account, the amount after the death of the account holder will go to the nominee as per the procedure. So if there is no nomination the claim will be settled as per the guidelines followed by each Banks as per the general procedure as follows:

Claim Application

First of all the Bank will require the Claimant/s to file an application to get the amount in the account of the deceased account holder to them. There will be prescribed formats for each Banks. The form will include space for entering the name of the deceased, full address of the deceased, date of death, place of death, proof of death, names of the claimants, their age, relationship with the deceased account holder etc.

Declarations or affidavits

The application will have to be accompanied by declarations by two or more independent persons who know the deceased person and not related with him or the claimants. The declaration form will include spaces for entering the name and full address of the deceased persons, names of the claimants, their ages, etc. The declaration will add trustworthiness to the claim preferred by the applicants. However the declarants have to be respectable persons known to the Bank and are worthy of the claim amount. They may need to have sufficient account balance with the bank or have net worth either equal to the claim amount or higher than the claim amount and should have recent transactions. The account must be running.

Proof of Death

The proof of Death is to be provided by the applicants along with the claim application. Documentary evidence need to be given by the claimants in proof of the death of the account holder.The Death Certificate has to be obtained from the Registrar of Births and Deaths. Even if the Bank has direct knowledge of the death of the customer, the provision is mandatory.

Receipt, Indemnity Bond and Affidavit

The Bank should obtain a signed receipt from the claimants while disbursing the amount. Indemnity Bond in stamp paper properly notarised is also needed. An affidavit declaring that the claimants are the only legal heirs of the deceased also may be required.