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Monday 9 June 2014

What to do in case of Death of the first holder in a mutual fund account

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Joint holders of an MF can manage the money in the folio using the "either or survivor" option. If one of them is no more, the fund must be notified and the account must be updated. If the first holder dies, the surviving second holder may not be able to put in a redemption request.

Application The surviving joint holder(s) (a maximum of three joint holders are allowed in a mutual fund folio) have to apply to the mutual fund requesting a transmission of the folio to the surviving joint holders and removal of the name of the deceased join holder. If the first holder dies, the second holder will become the first holder of the MF folio.

Documents A copy of the death certificate will have to be attached with the application. If any of the surviving joint holders have not completed the KYC formalities, they have to complete the same before the transmission can be completed.

Verification If the account was operated primarily by the now deceased unit holder, the signatures of the surviving joint holders may have been obtained only at the time of application, which might be long ago.

If required, update the signature by submitting fresh signature as attested by the bankers.

Operation The surviving joint holders have to decide on a mode of operation, i.e., jointly or, either or survivor. If there is only one surviving holder, it will become a single-holder account and will need a nomination.

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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