Same-sex partners can nominate each other in insurance policies, confirms LIC
When a queer couple from Kolkata filed an RTI request to know if there is any legal bar for anyone in making their same-sex partner a nominee in their insurance policies, the Life Insurance Company (LIC) confirmed that gender will not serve as a barrier.
The request was made by Suchandra Das and Sree Mukherjee and comes in the light of private and public banks rejecting same-sex couples from becoming policy nominees, without any legal basis.
"In effect, this means that there is no bar for a policy holder from making a person not related to him or her by birth, consanguinity, marriage, or adoption as his or her nominee." Das, who is a professional photographer, told the news agency IANS.
The RBI also weighs in: While the couple filed a similar request to Reserve Bank of India (RBI), their statement isn's as clear as the one submitted by LIC. Addressing the RBI reply, Das added, "Quoting Section 45ZA to 45ZF of the Banking Regulations Act, 1949, that deals with the issue of nomination, the RBI maintained that that there is no mention of any condition nor there are any restrictions regarding who can be a nominee. So, from this reply it is clear that no bank can insist that I can make only someone related to me as a nominee."
Calcutta HC offers a catch: However, the senior counsel from Calcutta High Court have mentioned that even though there is no legal bar for a person in making their same-sex partner the nominee, becoming a nominee doesn't imply that this nominee would be a successor of the insurance proceeds or funds in the account.
To explain further, this so-called nominee can only receive the money and is legally obliged to hand over the money to the successor of the deceased. To put it in a nutsheell, a nominee is "an agent of the policyholder."
Justice Ajay Kumar Gupta however explains how there are legal means to turn such a nominee into a successor of the funds."In, that case, the policyholder or bank account holder will have to bequeath those funds by executing a registered will and thus making the nominee also the successor,"
Will other insurance companies follow suit? While sharing this news, writer and human rights activist Sharif Rangnekar tagged the Instagram handles of SBI, Max Life Insurance, and Kotak Life Insurance, writing, "I hope other insurance companies issue similar clarifications."
While LIC's statement is definitely crucial, it is yet to be seen how practically applicable would it be for same-sex couples to appoint nominees in the policies offered by such firms. Homosexuality might be decriminalised but given how same-sex marriages are also not accorded a legal status in the country, such joint banking plans come with their own sets of challenges for such couples.