The Married Women's Property (MWP) Act was enacted
with a view to protect the properties of women against the creditors.
Let understand in
details about MWP act......
What is MWP Act?
The Married Women’s Property Act, 1874
protects the property of a wife if the proceeds of her husband’s life insurance
policy is attached to pay for outstanding loans in the event of his death or
bankruptcy.
Under MWP Act all the
properties that belong to the women gets insulated and protected from all the
other court attachments or any income tax department attachments that the
husband has run up.
Let's take an example a business family; the family could be a
trader or a manufacturer or any other business. In due course of business there
are some credit limits or there are bank loans, which have been taken by the
business. The bank secures these credit limits against the assets of the
business and also takes a personal guarantee of the owner of the business which
could be the husband or the family.
In case of the
untimely death of the husband the bank starts recovering their loans and in the
process they liquidate the assets of the business and also they attach the
properties that belong to the guarantor, which in this case is the husband.
Differences of MWP ACT
Conditions
The policy can be bought only by a married man who is an Indian citizen. The beneficiaries of the policy must be his wife and/or children. Even a divorcee or a widower can buy an insurance policy with an MWP addendum. A married woman can also buy such a policy with her children as beneficiaries.
Process
The
process of taking the policy under MWP is very simple. At the time of making an
application one has to fill in MWP addendum. This form is also provided by life
insurance companies. In the form one has to fill in the details of his wife and
children, whoever he wishes to make beneficiaries in the policy. In case of
death, the policy proceeds do not go to anybody else other than the beneficiary
as named by you in the policy. There is no attachment because the policy does
not belong to the husband.
Surrender of policy
In case a cash value policy is surrendered, the proceeds will go to the beneficiaries. If the policyholder survives the term, the maturity proceeds would still go to beneficiary.
Point to note
We talk about life insurance as means of financial protection. What is the sense if the money does not go to the family and gets attached for some other reasons? Let me make a point here, all kind of life insurance policies whether online term policies or any other form of life insurance policies are entitled to be issued under MWP Act and one should definitely make a point that he issues a policy under MWP Act to protect his family.
We talk about life insurance as means of financial protection. What is the sense if the money does not go to the family and gets attached for some other reasons? Let me make a point here, all kind of life insurance policies whether online term policies or any other form of life insurance policies are entitled to be issued under MWP Act and one should definitely make a point that he issues a policy under MWP Act to protect his family.
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