Report No. 66

8.29. Point-(c)(i)-Question as to formula to be used.-

We now proceed to the next question pertaining to the formula to be used for conferring the benefit contemplated by section 6. From the decided cases, to which we have referred above, a few salient points arise-

(a) The mere use in the proposal of the words "for family provision" does not1 bring the policy within section 6(1).

(b) Mere assignment in favour of the wife does not also bring2 the policy within section 6(1).

(c) At the same time, the policy need not copy the phraseology used in the section. In one Madras case3, the High Court has held, (with reference to section 6):

"That section states that the policy shall, on the face of it, express that it is to be for the benefit of the wife and if it is so expressed, then it says, the policy shall be deemed to be a trust for the benefit of the wife. There is nothing in the language of the section to show that the words "for the benefit of his wife" or others corresponding to these should appear in the policy to enable us to infer a statutory trust in favour of the wife within the meaning of the section. If, on reading the words in the policy, it appears that the assured has intended in the event of his death, that the policy should enure to the benefit of his wife, then I think the policy may be deemed to be a trust for her benefit."

In this case, in the schedule to the insurance policy taken by the petitioners husband, it was provided that the sum was payable to "the assured or his wife Abhiramavalli if he predeceases her". It was held that this was a policy of assurance expressed "to be for the benefit of his wife", though the express words "for the benefit of his wife" did not appear in the terms of the policy. In this case, it was held that a statutory trust in favour of the wife had been created. The High Court, however, pointed out that in order to avoid difficulties, the insurance companies should, in drawing up the terms of the policy in cases where the assured intended to create a trust in favour of his wife in the event of his death, adopt the words used in the statute4.

1. Rabibai v. Ratanlal, AIR 1938 Nag 321, para. 8.26, supra.

2. Manibai v. Bhimji, AIR 1946 Sind 171 (175), para. 8.27 supra.

3. Abhirmavalli v. Official Trustee, AIR 1932 Mad 220 (222).

4. Emphasis added.