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Deceased Account

Reviewed by Vineeth | Updated on Jan 29, 2021



Deceased accounts are bank accounts that are owned by a person who is no more alive (deceased). Banks will freeze the account(s) when they get notified that the account has been deceased. The money and belongings (if stored in a bank locker) will be handed over to the legal heirs as per the court's directions.

Understanding a Deceased Account

When the account holder is no more, the legal heirs are to inform the banks at the earliest about the same. They must notify the bank about the death by furnishing death certificate, ID proof, and account details (if they know).

If there is nothing that the deceased person owes to creditors, then the proceeds from the deceased accounts will be handed over to the legal heirs. If there is any unpaid debt, then the account balance would be recovered by the creditors. The remaining amount, if any, will be handed over to the kins.

If the deceased accounts are pay-on-death accounts, then the bank will hand over the proceeds to the nominee or beneficiary when the account holder gets deceased. The nominee or beneficiary should report the death of the account holder with proper proof of identification.

The proceeds in the case of joint accounts held with a deceased person will result in the surviving owner gaining full ownership over the account. The surviving owner may continue to operate on the account or close the same. Joint accounts held with a deceased person are not considered deceased accounts.

How Does a Deceased Account Work?

Creditors are given the preference over legal heirs and kins when an account becomes deceased. Hence, deceased accounts become extremely important for the lenders if the deceased has any unpaid debt. The legal heirs and kins are not liable to settle the liabilities of the deceased, and therefore, the creditors can recover their dues only by whatever is left in the deceased account and estate.

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