Question: A customer passed away without leaving a nominee. The claimant submitted all the documents required under the bank's approved policy, but the branch asked for additional legal documents that were not part of the policy. Based on the RBI Master Circular on Customer Service in Banks, 2014, did the bank handle the claim appropriately?
Answer: No, the RBI Master Circular requires banks to follow their Board- Approved policy for settling claims where no nomination or survivorship mandate exists. Asking for additional documents beyond the approved procedure is not in line with those instructions. Hence, the bank should process the claim according to its approved policy.

Supporting evidence:
title: rbi.org.in/72MC010714CS.pdf
quote: In case where the deceased depositor had not made any nomination or for the accounts other than those styled as "either or survivor" (such as single or jointly operated accounts), banks are required to adopt a simplified procedure for repayment to legal heir(s) of the depositor keeping in view the imperative need to avoid inconvenience and undue hardship to the common person
context: ience to the survivor(s) / nominee and would, therefore, invite serious supervisory disapproval. In such case, therefore, while making payment to the survivor(s) / nominee of the deceased depositor, the banks should desist from insisting on production of succession certificate, letter of administration or probate, etc., or obtain any bond of indemnity or surety from the survivor(s)/nominee, irrespective of the amount standing to the credit of the deceased account holder.

20.2 Accounts without the survivor / nominee clause

In case where the deceased depositor had not made any nomination or for the accounts other than those styled as "either or survivor" (such as single or jointly operated accounts), banks are required to adopt a simplified procedure for repayment to legal heir(s) of the depositor keeping in view the imperative need to avoid inconvenience and undue hardship to the common person. In this context, banks may, keeping in view their risk management systems, fix a minimum threshold limit, for the balance in the account of the deceased depositors, up to which claims in respect of the deceased depositors could be settled without insisting on production of any documentation other than a letter of indemnity.

20.3 Premature Termination of term deposit accounts

In the case of term deposits, banks are required to incorporate a clause in the account opening form itself to the effect that in the event of the death of the depositor, premature termination of term deposits would be allowed. The conditions subject to which such premature withdrawal would be permitted may also be specified in the account opening form. Such premature withdrawal would not attract any penal charge.

21.1 Access to the safe deposit lockers / return of safe custody articles (with survivor/nominee clause)

- 21.1.2 However, banks should take the following precautions before handing over the contents:
- (a) Banks should exercise due care and caution in establishing the identity of the survivor(s) / nominee(s) and the fact of death of the locker hirer by obtaining appropriate documentary evidence;
- (b) Banks should make diligent effort to find out if there is any order from a competent court restraining the bank from giving access to the locker of the deceased; and
- (c) Banks should make it clear to the survivor(s) / nominee(s) that access to locker / safe custody articles is given to them only as a trustee of the legal heirs of the deceased locker hirer i.e., such access given t