According to Section 6 of the Married Women’s Property Act (MWPA) of 1874, the benefits of an insurance policy of a married man is directed towards his wife, or his wife and his children alone. In any case, the benefits are not to be transferred to the control of the husband or to his creditors which protects the rights of the policy holder’s wife over the benefits of the insurance.
The clearly goes on to state that any insurance policy taken by a married man on his own life and categorised under the MWPA in favour of his wife and children will always be their property. The policy holder or any of his creditors will not have any right or control over the property or the benefits of the insurance policy whatsoever.
Insurance endorsed under MWPA will also exclude the husband’s parents from claiming the benefits of the insurance which strips them of the right to claim. As a matter of fact, the husband (policy holder) himself will not have any right over his own survival benefits of the insurance policy, if there are any. According to the MWPA Act, as long as any one of the beneficiaries declared in the policy is alive, no one else has the right to claim the benefit of the same.
This way, the Married Women’s Property Act provides a method in which a policy holder who is a married man ensures that his immediate family named in the policy is protected without having to create a separate deed or a trust. The MWPA, by default, creates a trust with the beneficiaries of the policy as trustees without a formal trust and also protects the family of the policy holder from his creditors or anybody else for that matter.
The first and last intention of getting a life insurance is to help the next of kin financially after the policy holder’s demise, so that their lives are not left unsupported. The purpose of securing the family members’ lives is not complete till the benefits reach them and not a third party. That way, the family is supported financially with the sum assured from the policy till they figure out another source of income to compensate their bread winner’s income.