The legal heir usually gets the money in the end: a nominee on a bank deposit, a mutual fund folio or a demat account only collects it and holds it for the heirs named by the will or by succession law. The exceptions are life insurance, where the Insurance Act makes a parent, spouse or child nominee beneficially entitled (though a 2025 High Court ruling let the legal heirs share it), and EPF, where marriage cancels any earlier nomination. Suresh's case below shows where one nomination made at 25 sends ₹38 lakh of PF and ₹2 crore of cover today.

Nominee rights depend on the asset.

Asset Who you can nominate Does the nominee keep it?
Bank deposit Up to four people, simultaneous or successive, since 1 November 2025 No, holds it for the legal heirs (Supreme Court, 2010)
Mutual fund folio, demat account Up to three people since 1 September 2026 No, receives it as trustee for the legal heirs (SEBI, July 2026; for shares and demat, Supreme Court, 2023)
Life insurance Anyone A parent, spouse or child is a beneficial nominee under section 39(7), though the Karnataka High Court (2025) let the legal heirs share it; anyone else holds it for the heirs
EPF Only family, once you have one EPFO pays the valid nominee, who must be family; with none, the family shares it equally

The bank limit is in the Banking Laws (Amendment) Act, 2025, and the securities limit in SEBI's circular of 29 May 2026, which also makes a single holder opening an account nominate or sign an opt-out. A policy a husband takes under section 6 of the Married Women's Property Act, 1874, for his wife and children, is different: it is a trust for them, outside his estate and beyond his creditors' reach unless it was taken out to defraud those creditors, and section 39 does not apply.

Suresh's case: why his PF nomination lapsed when he married

Suresh earns ₹32 lakh CTC. At 25 he named his mother as nominee on his EPF, now ₹38,00,000 (how EPF builds up), and on a ₹2 crore term plan. He has since married and has a daughter, now three. His mother draws her own pension, so she does not depend on him.

The EPF catch is in the EPF Scheme, 2026, in force since 29 June 2026: on marriage a member must make a fresh nomination, and any nomination made before the marriage is deemed invalid (para 44(3)). So his EPF nomination is invalid. If he died today, para 50 would pay ₹38,00,000 to his family in equal shares: ₹19,00,000 to his wife and ₹19,00,000 to his daughter, through a guardian. His mother would get nothing from the PF: a parent counts as family only when dependent.

The term plan runs the other way. The insurer pays his mother the full ₹2 crore, and section 39(7) says a parent nominee is beneficially entitled to it. That is not settled: in February 2025 the Karnataka High Court, on almost these facts (a son named his mother, then married and had a child), held that the nominee's claim gave way to the legal heirs. If that view holds and the family is Hindu, his Class I heirs, his mother, wife and daughter, would take ₹2 crore ÷ 3, about ₹66.7 lakh each. A dispute over who keeps the money needs a lawyer.

What should you update after marriage, and in what order?

First, EPF, because that nomination is void now. He files a fresh EPF nomination on the EPFO member portal, choosing how ₹38 lakh splits between his wife and daughter and naming a guardian for the daughter. He cannot add his mother: with a family, only family members can be nominated, and an independent parent is not one.

Second, the term plan. He decides who the ₹2 crore is for and changes the nomination by endorsement, adding an adult appointee for his daughter's share while she is a minor; the insurer must acknowledge it in writing.

Third, savings accounts, FDs, funds and demat. On these a nominee only collects, so a will, or succession law where there is none, decides who keeps the money. The pension part of PF follows the Employees' Pension Scheme, 2026: the widow's and children's pensions go to them by right, and a pension nominee counts only for a member with no spouse or eligible child.

What if there is no nominee at all?

With no will and no dispute, the papers are simpler up to ₹15 lakh per bank (₹5 lakh at a co-operative bank, or a higher limit the bank sets) under RBI's 2025 directions; for funds and demat, with no dispute, up to ₹10 lakh per fund house and ₹30 lakh per demat account under SEBI's July 2026 rules. Above that, banks and fund houses ask for stronger proof, such as a succession certificate, a legal heir certificate or a notarised affidavit about the heirs. Inheriting without a will lists the papers for each, and money steps after a spouse dies sets out the claims in order.

Dhi looks at your protection, net worth and goals together, so your term cover and EPF balance sit in one picture with the rest of your money. Dhi answers questions from your own numbers and nudges when something needs attention.

Frequently asked questions

For bank deposits, mutual funds and shares, in effect yes: the nominee collects the money, and the will, or succession law where there is none, decides who keeps it. For a life policy, section 39(2) of the Insurance Act, 1938 lets a will cancel or change the nomination, but an insurer that pays the registered nominee before it receives written notice of the change is protected.
No. A life policy nomination stays valid until you change it by endorsement or by a will (section 39(2) of the Insurance Act, 1938), so a parent named before marriage remains the nominee. EPF, and the EPS pension nomination, are where marriage itself cancels it, under the 2026 schemes.
Log in to the EPFO member portal with your UAN, open the e-nomination page, add each family member with their Aadhaar, set each person's share and sign with an Aadhaar OTP. The EPF Scheme, 2026 lets you change it on the portal at any time, and a change counts from the date EPFO receives it.

This is general information for salaried individuals in India, not personalised financial advice.