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Deceased depositors: model procedure for claims settlement

Special Correspondent

CHENNAI: The Indian Banks' Association (IBA) has issued a "model operational procedure" to be adopted by member-banks for "settlement of claims of deceased depositors".

The model procedure, besides incorporating the detailed guidelines issued in June 2005 by the Reserve Bank of India (RBI) in this regard, covers settlement of claims falling within the threshold limit for cases having no nominee or survivorship clause.

It has left it to member-banks to determine the threshold limit keeping in view their risk management systems.

Claims within the threshold limit will be settled against indemnity to be furnished by legal heir(s) of the deceased depositor as may be applicable to specific claims.

The IBA's model procedure enjoins on banks to provide guidance to customers on the advantages of the nomination facility/survivorship mandate.

It details procedures for settlement of claims in various types of accounts/facilities (like accounts with or without nomination clause and joint accounts with or without survivor clause).

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