Cap. 16 Art. 1712DLegal effects of designation.

(1) Subject to the right of revocation by the policyholder as provided in article 1712C(3) and the provisions of sub-article (7)

of this article relating to group policies, when made payable to one or more designated beneficiaries, the proceeds and any benefit arising from a contract of insurance, including any surrender value, are due to the beneficiary and form part of his estate, whether or not such beneficiary is aware of such designation.

(2) The beneficiary shall not enjoy any rights other than as stated in sub-article (1) in relation to the policy and the insurer shall not disclose any information about the policy without the prior written consent of the policyholder, until such time as the policyholder dies in which case the insurer, upon becoming aware of such fact, shall inform the beneficiary of his entitlement:

Provided that the insurer shall inform a beneficiary who has accepted the designation, of the reasons which may produce the lapse of the policy, and this within a reasonable time prior to such lapse taking effect.

(3) After acceptance by a beneficiary -

(a) the revocation of the designation of a beneficiary, or

(b) the modification of the sum for which the policy has been taken out, or

(c) the pledge or assignment of the policy, may only be made with the prior written consent of the beneficiary:

Provided that the above shall not apply to a group policy which shall be governed by the terms of any applicable scheme, and:

Provided further that a pledge or assignment made without such consent shall be valid but shall be subject to the prior rights of the designated beneficiary.

(4) Acceptance by a beneficiary of a designation in terms of this provision shall be dated, signed by the beneficiary and countersigned by a witness and shall be notified to the insurer. For the purposes of this article -

(a) "written" shall not include electronic means, and

(b) a written demand claiming the proceeds under the policy to the insurer by the designated beneficiary shall be treated as acceptance in writing.

Any such acceptance shall be noted by an endorsement to the policy.

Notice of a designation of a beneficiary may be given even after the death of the policy holder or the life insured provided that any such notice is given within seven working days of such death after which period the designation shall lapse and shall not have any legal effects.

(5) Subject to the express terms of the designation, all references to the beneficiary in these articles shall be construed as including the heirs, legatees, pledgees or assignees, as the case may be, of the designated beneficiary.

(6) All transactions referred to in these articles shall have legal effects only when the insurer receives notice thereof or otherwise acknowledges a written notice and in cases where more than one such act is notified, any such acts shall take effect subject to any previously notified or acknowledged acts.

(7) The following rules shall apply in the case of group policies referred to in article 1712B(6):

(a) the entitlement of such beneficiary shall be in accordance with the terms of such scheme and it shall be lawful to provide for any conditions including the termination of benefit on the termination of employment;

(b) subject to the terms of the scheme not providing otherwise, the participant in a scheme shall not be entitled to assign or pledge his rights nor shall he be entitled to the surrender value of the policy on termination of benefit and the arrangement shall provide rules on the transferability of the benefits as required by applicable law.