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Report No. 82

6.11. Section 39(7), Insurance Act, 1938-Nomination and Trust.-

In order to complete the discussion, we may , at this stage, also refer to the Report of the Law Commission on the Married Women's Property Act, 18741, by which a few change were recommended in the Insurance Act, 19382. The first'3 point dealt with in that Report concerned section 39(7) of the Insurance Act which , at present, includes the application of the provisions of section 39 to any policy of life insurance to which section of the Married Women's Property Act, 1874 applies, or has, at any time, applied.

The Law Commission pointed out that a person who decides to create a trust under section 6 of the Married Women's Property Act, 1874, may, by a misunderstanding of the law or through slip or ignorance, enter also a nomination in the policy. In such a case, what should prevail is the trust under section 6, and not the nomination. The Commission noted that as the provision to section 39(7) of the Insurance Act, 1938 now stands, it is possible to take the view that the nomination overrides the trust. It was desirable to prevent such a situation from arising. An amendment to section 39(7), proviso, Insurance Act, on this point was accordingly recommended by the Commission.

1. Law Commission of India, 66th Report (Married Women's Property Act, 1882), Chapter 8.

2. Law Commission of India, 66th Report (Married Women's Property Act, 1882), paras. 15.15, 15.16 and 15.17.

3. Law Commission of India, 66th Report (Married Women's Property Act, 1882), para. 6.54.



Effect of Nomination under Section 39 of the Insurance Act, 1938 Back




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