Things to do to change the ownership of a mutual fund

K. ARAVIND

In the event of death of the mutual fund unit owner, the fund units have to be transferred to another person. The process of converting mutual fund units can be easily completed if the required documents are submitted properly. If the investment is in various fund houses, you will have to submit to submit a separate application to each fund house for conversion of mutual fund units.

In the event of death of the first owner of the fund units, the units will be transferred to the name of the second owner. This is the case with joint accounts. If the account is a single owner-only account, the units will be transferred to the nominee’s account. The second account holder or nominee must notify the fund house about the death of the first account holder. Death Certificate, KYC details and Bank Account Number should be enclosed.

Some fund houses require the bank to certify the bank account details of the second unit owner and nominee. If the units are transferred to the name of the owner of the second unit, only the above documents are required by the fund houses. If the nominee makes a claim regarding the deposit, he/she will have to produce some additional documents. In addition to the above documents, an Indemnity Certificate is required. Fund houses follow different models in terms of this certificate. Mutual fund units change process is completed within five to 10 days after receipt of required documents.

Many investors buy mutual fund units in demat form through stock exchanges. In case of death of one of the mutual fund unit owners, the living account will be transferred to the owner’s name. For this, the living account holder has to submit the death certificate and the completed application form for closing the account.

If the mutual fund units are in demat form, the second account owner can transfer it to the name of the holder or nominee only in the same format. There must be a demat account be in the name of the person to whom the units are to be transferred. If not, you will need to open a new depository account. For this, the required procedures have to be completed and documents have to be produced.