Nominee

A nominee is named by a depositor, policyholder or investor so that the institution knows whom to pay after the holder's death. Paying the nominee gives the bank or company a valid discharge, so the claim is settled quickly.

Nominee or owner

Courts have held that a nominee generally receives the money as a trustee for the legal heirs, who are the real owners under the will or the law of succession. The Supreme Court said this for life insurance in Sarbati Devi v Usha Devi (1984) and for shares in Shakti Yezdani v Jayanand Salgaonkar (2023). Life insurance has a special rule: under Section 39 of the Insurance Act, 1938, a parent, spouse or child named as nominee (a beneficial nominee) takes the money for themselves.

Bank nominations since November 2025

Under the Banking Laws (Amendment) Act, 2025, from 1 November 2025 a depositor can name up to four nominees, either simultaneously with fixed shares or one after another. The RBI's nomination directions of 2025 set out how banks handle this.

• Keep nominations up to date after marriage, divorce or a death in the family.
• Make a will if you want the money to go to the nominee as owner.
• Tell your nominees where the accounts are.

Use the fixed deposit nomination form or the nominee to heir transfer letter, and read nominee vs legal heir: who gets the money.