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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

Part-6 -Clarifications regarding Provisions in Nomination Rules and Discretionary Administrative Powers for settlement of claim

6.1 The Banking Companies (Nomination) Rules 1985 have been framed in terms of Sections 45 ZA to 45 ZF of the Banking Regulation Act,1949.

1. Deposit Accounts
  • Nomination facility is intended only for individuals including a sole proprietary concern.
  • There cannot be more than one nominee in respect of single/joint deposit account.
  • Bank may allow variation/cancellation of a subsisting nomination by all the surviving depositor(s) acting together. This is also applicable to deposits having operating instructions “Either of Survivor”.
  • It may be noted that in the case of a joint deposit account the nominee’s right arises only after the death of all the depositors.
2. Safe Deposit Lockers
  • Nomination facility is available in respect of lockers hired singly as well as jointly. In respect of lockers in joint names nomination rules are applicable only if lockers are operated jointly.
  • Where the lockers are hired jointly,on the death of any of the joint hirers,the contents of the locker are allowed to be removed only jointly by the nominee(s) and the survivor(s) after an inventory is taken in the prescribed manner. In such a case,after such removal preceded by an inventory,the nominee and surviving hirer(s) may still keep the entire contents with the same bank, if they so desire, by entering into a fresh contract of hiring a locker.
  • Banks are not required to open sealed/closed packets found in locker while releasing them to the nominee or nominees and surviving hirers. Description of the sealed/closed packet(s) should however be mentioned in the inventory.
  • Section 45 ZE of the B.R Act,1949 does not preclude a minor from being a nominee for obtaining delivery of the contents of a locker. The responsibility of the bank in such cases is to ensure that when the contents of a locker are sought to be removed on behalf of the minor nominee,the articles are handed over to a person who,in law, is competent to receive the articles on behalf of the minor.
3. Safe Custody Articles

Nomination facility is available only in the case of individual depositor / sole proprietary concern and not in respect of persons jointly depositing articles for safe custody.

6.2 Discretionary Administrative Powers for settlement of claims

Powers are given in Chapter-1 Customer Services para 1.1 of Discretionary Administrative Powers for Domestic Operations (Publication No.154- Revised 2014) in respect of payment of balance in the account of the deceased customer to the nominee / legal heirs/ claimants may be exercised by the different authorities.

Settlement of Claims in Various types of Operational instructions
Deposits
With Nomination
Account in the Name of Operational Instructions Nominee Situation What is to be done
A Self X X dies A can change the nomination
A Self X A dies X will receive the outstanding
A,B Either or Survivor X A dies Balance outstanding will be payable to B.
A,B Either or Survivor X B dies Balance outstanding will be payable to A.
A,B Either or Survivor X A & B dies X will receive the outstanding
A,B Jointly X A dies Payable to B and legal heirs of A jointly
A,B Jointly X B dies Payable to A and legal heirs of B jointly
A,B Jointly X A & B dies Payable to X
Without Nomination
Account in the Name of Operational Instructions Situation What is to be done
A Self A dies Outstanding will be payable to the legal heirs or any one of them mandated by all of the legal heirs
A,B Either or Survivor A dies Outstanding will be payable to B
A,B Either or Survivor B dies Outstanding will be payable to A
A,B Either or Survivor A & B dies Jointly payable to legal heirs of A & B (or any of them mandated by all the legal heirs)
A,B Jointly A dies Jointly payable to B and legal heirs of the A (or any one of them mandated by all the legal heirs).
A,B Jointly B dies Jointly payable to A and legal heirs of the B (or any one of them mandated by all the legal heirs)
A,B Jointly A & B dies Jointly payable to legal heirs of A & B (or any of them mandated by all the legal heirs)
Lockers
With Nomination
Locker inthe Name of Operational Instructions Nominee Situation What is to be done
A Self X X dies A can change the nomination
A Self X A dies X will be given access to the locker and liberty to remove contents
A,B Jointly X A dies B and X will be given access to the locker and liberty to remove contents jointly.
A,B Jointly X B dies A and X will be given access to the locker and liberty to remove contents jointly
A,B Jointly X A & B dies X will be given access to the locker and liberty to remove contents.
A,B Jointly X & Y A dies B along with X and Y will be given access to the locker and liberty to remove contents jointly
A,B Jointly X & Y B dies A along with X and Y will be given access to the locker and liberty to remove contents jointly.
A,B Jointly X & Y A & B dies X and Y jointly will be given access to the locker and liberty  to  remove  the contents
Without Nomination
Locker in the Nameof OperationalInstructions Situation What is to be done
A Self A dies Legal  heirs of  A or  any of them mandated by any of them.
A,B Either or Survivor A dies B will be given access to the locker and liberty to remove the contents.
A,B Either or Survivor B dies A will be given access to the locker and liberty to remove the contents.
A,B Either or Survivor A & B dies Legal heirs of A and B (or any one of  them mandated  by all  legal heirs) will be given access to the locker and liberty to remove the contents.
A,B Jointly A dies B and legal heirs of A (or any of them mandated by all legal heirs) will be given access to locker and liberty   to    remove    the   contents jointly.
A,B Jointly B dies A and legal heirs of B (or any one of them mandate by all legal heirs) will be given access to locker and liberty   to   remove   the   contents jointly
A,B Jointly A & B dies Legal  heirs  of A & B (or  any of them mandated by all legal heirs) will be given access to locker and liberty to remove the contents.

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