In a heart-wrenching legal battle that unfolded in the corridors of the Allahabad High Court, a grieving grandmother, Smt. Kusum, fought to claim the life insurance benefits left behind by her late daughter. What began as a mother’s attempt to secure her future ended in a courtroom drama that pitted her against her own granddaughter—an infant barely a year old. The case, steeped in emotion and legal complexity, culminated in a verdict that reaffirmed the supremacy of inheritance laws over insurance nominations.
Smt. Kusum had taken out 15 life insurance policies in the name of her daughter, Ranjeeta, when she was still unmarried. As life unfolded, Ranjeeta married Anand Kumar (Respondent No. 1), and the couple had a daughter (Respondent No. 2). Tragedy struck when Ranjeeta passed away on September 1, 2021, leaving behind her 11-month-old child.
Kusum, who had been named the nominee in all 15 policies, expected to receive the insurance payouts. But to her shock, Anand Kumar and the infant daughter filed for a succession certificate—without even informing Kusum. The case was quietly settled in a Lok Adalat, excluding Kusum entirely. Feeling betrayed and sidelined, she turned to the courts for justice.
Kusum’s plea was simple yet powerful: her daughter had named her as the nominee in all 15 insurance policies. Under Section 39(7) of the Insurance Act, she argued, this made her the “beneficial nominee”—entitled to the full payout. She wasn’t trying to deny her granddaughter’s inheritance, she insisted, but believed that the insurance money, specifically, was meant for her.
Her legal team emphasized that the law had changed in 2015 to recognize certain nominees—like parents—as rightful beneficiaries, not just caretakers of the money. Kusum, having cared for her daughter and now facing old age alone, hoped the court would honor her daughter's wishes.
Anand Kumar and his daughter’s legal team countered with a different perspective. They argued that while Kusum may have been named as a nominee, that did not make her the legal heir. According to the Hindu Succession Act, the rightful heir to Ranjeeta’s estate—including the insurance money—was her daughter.
They pointed out that nomination under insurance law is primarily a mechanism for ensuring smooth disbursal of funds, not a declaration of ownership. The real question, they said, was who inherits the estate—and that, they argued, was clearly the child.
The Hon’ble Justice Pankaj Bhatia made several key observations in his detailed judgment:
The court also noted that while some High Courts had interpreted Section 39(7) differently, the prevailing view—supported by the Supreme Court—was that nomination does not confer ownership.
In a verdict that balanced legal precedent with emotional sensitivity, the court dismissed Kusum’s petition. It upheld the lower court’s decision to exclude the insurance amounts from the succession certificate and directed that the ₹15 lakh from the policies be deposited in fixed deposits in the name of the granddaughter until she turns 18.
While Kusum may not have received the financial relief she sought, the judgment ensures that her granddaughter’s future is financially secure. The ruling also sets a significant precedent, reinforcing that inheritance laws take precedence over insurance nominations, even in emotionally charged family disputes.
Case Title: Smt. Kusum v. Anand Kumar and 3 Others
Decision Date: April 30, 2025
Court: Allahabad High Court, Lucknow Bench
Judge: Hon’ble Justice Pankaj Bhatia
This article is for informational purposes only and does not constitute legal advice. For legal interpretation or advice, please consult a qualified legal professional.