Joint life insurance policy for couple...how beneficial?
Facts to face when a parent passes away
When a parent dies suddenly, the heart is heavy and filled with sorrow. During the bereavement, you tend to focus on the things that must be done immediately. After the mourning, there are many wealth-related issues that are to be sorted out. It is major task. Take a look at what experts have to say about this crucial issue.
Death CertificateAfter the death of a person, a death certificate has to be obtained by the family members. It is a must for closing accounts and for legal heirs to claim the amounts, properties, transfer of assets, or insurance. Experts suggest that a number of copies of the death certificate should be taken, to be submitted whenever necessary. At least 10 copies should be kept handy. If it is a natural death, a death certificate would do. In case of unnatural death, post mortem report and a letter from the concerned police station should be taken. Authorities should be informed about these within 21 days and a death certificate should be obtained.
If a mother or a father dies while undergoing treatment in a hospital, your full name, the parent's name, age and detailed address should be submitted to the hospital authorities on prescribed form. The hospital management will send this to local Birth and Death recording centre. In cities this is sent to the concerned municipality. A death certificate has to be obtained from them. While filling the form in the hospital, the details of the deceased should be cross checked with his or her Aadhar card. There should not be any differences in the names, age or other details. Surname and maiden name should be mentioned in full. In case of mistakes, the form might not be accepted and a lot of time is wasted in going round the hospital and municipal offices.
Nominee, Will, legal heir certificateCheck to see if the deceased has already written a Will. It becomes a key document in many monetary issues. It will explicitly explain how properties are to be distributed and to whom. In case of a Will, it is easy to distribute bank accounts and other investments. A nominee, in this case, will not have any legal rights. He or she will only be a representative of the legal heirs. In the absence of a Will, legal heir certificate should be obtained from the local court. This is only for immovable assets. Legally speaking, immovable assets like real estate have to be distributed among the heirs. In case the legal heirs do not want the immovable properties, they can transfer it on to the surviving parent. A release deed has to be signed. A written Will by the parents will save disputes among legal heirs as well as time in fighting for justice.
Documents to be securedSecure all related documents of the deceased parent. Usually, parents who are aware, keep all the documents neatly filed, in a secure place. Otherwise, they have to be identified. Sometimes all the documents are not available. For example, physical documents regarding shares. They have to be saved on a computer. If the stocks are owned, but there are no documents, it is a loss. Experts state that once all the documents are secured, they have to divided into four categories, like assets, loans, expenditure and revenue. Details of bank pass books, deposits, ATM cards, credit cards, insurance documents, demat accounts in case of stocks, mutual funds, senior citizens savings, NSC, fixed deposits, utility bills (electricity, water, gas, phone and internet), property documents and loan repayments should be secured. In case the deceased was working at the time of death, documents regarding this should also be obtained. The concerned government department or private company should be informed. Employees are normally insured. By claiming this amount, some immediate monetary needs could be met.
Debts and other payments
Check to see if there are any pending loans. Some of them are paid automatically from the bank accounts through ECS. In case of pending loans, ensure that the bank balance is sufficient to make up for the remaining payments. Some might have to be repaid immediately. Try to repay as soon as possible or take some time. Credit card loans if any are best cleared immediately. Otherwise, heavy interest rates will he charged. Monthly dues can be paid. In case of SIPs decide whether to continue them or not.
Inform authoritiesIn case of death of a parent, their bank or insurance authorities should be informed. In case of investments, those companies too must be informed of the death. If loans have been taken, the concerned institutions should be informed in writing. Bank accounts and insurance policies need to be closed. Joint accounts might be transferred in the name of the surviving partner or one of the other account holders. In case a locker was owned, access to this will be stopped temporarily. After the legal process of transfer, either the nominee or legal heirs will be given access. Companies giving pensions should be informed. The employers of the deceased should also be informed. Every company has a format, which has to be fulfilled.
Bank Account
In case of joint accounts, meet the bank officials to see if it can be continued or not. If the surviving parent already has an account, it is fine. Otherwise, a new account has to be opened. Or they can be nominated. For this, death certificate, nominee or another joint account holder authentication, residential address, Aadhar and pan cards should be produced. In case of a single account holder, the nominee can claim the balance if any. Only nominees or legal heirs will have the authority to claim the amounts.
Life Insurance
Nominee in case of Term Life Insurance policy can claim the amounts. Death certificate, nominee address, residence certificates should be submitted. It will take 30 days to 45 days for the Life Insurance company to approve the payments. So the claim should be made early.
Medical Insurance
The name of the deceased should be struck of any medical insurance family plan, during renewal. The policy will automatically be transferred to the surviving parent. Death certificate has to be submitted for this.
Vehicles
Legal heirs will have to visit Road Transport Officer (RTO) and transfer vehicles if any, owned by the deceased, to their names. For this too, death certificate, Aadhar, pan cards, and other authentication certificates should be produced while applying for transfer.
Gas, telephone
LPG gas or telephone connections that are in the name of the deceased might also be changed. For this too, death certificate and other authentications have to be produced by legal heirs, for transfer.
InvestmentsAll investments will have the names of nominees. These nominees have to apply by producing Bonafide certificate along with address proof. Death certificate of the deceased is essential. Nominee or legal heirs can stake a claim. The latter too should produce necessary proofs and affidavit.
IT Returns
In the case of death of a parent, the legal heirs will have to file Income Tax (IT) returns for that particular year. This is if they come under the IT slab. IT exemption is granted up to Rs. 2.5 lakh for those below 60 years of age, up to Rs. 3 lakh for those between 60 years and 80 years of age and Rs. 5 lakh for those above 80 years. For these categories, returns need not be filed. However, if revenue crosses these limits, returns have to be filed. Death certificate of the deceased, pan card, legal heirs' pan cards, inheritance certificate, affidavit with notary stamp, should be filed along with returns. Later, the pan card of the deceased should be cancelled by IT officials. For this too death certificate should be produced.
