Sebi Proposes Easier Process For Heirs To Claim Securities After Investor’s Death

Capital markets regulator Securities and Exchange Board of India (Sebi) proposed several measures to make it easier for legal heirs to claim securities after the death of an investor. In a consultation paper released on March 12, the regulator proposed to simplify documentation requirements, raise limits for simplified procedures and introduce a faster process for small claims.

The regulator said the proposed changes are aimed at making it easier for families of deceased investors to claim securities. These proposals come as Sebi said it received feedback from investors and intermediaries that the current process is often complex and inconsistent across entities that handle transmission requests.

Sebi has invited public comments on the proposals until April 2, 2026.

Higher Limits for Simplified Documentation

As per the existing framework, simplified documentation is allowed for transmission of securities only up to Rs 5 lakh per listed entity for physical holdings and Rs 15 lakh per beneficial owner for dematerialised holdings. Beyond these limits, investors’ families are required to submit more detailed legal documents.

Sebi has proposed increasing these limits to Rs 10 lakh for physical holdings and Rs 30 lakh for demat holdings.

The regulator said the existing limits are no longer adequate “given the exponential growth of the securities market and increased asset prices.”

Straight-Through Processing for Small Claims

Sebi has also proposed a new straight-through processing (STP) route for very small claims, where minimal documentation will be required.

Under this proposal, claims up to Rs 10,000 per listed entity or mutual fund for physical holdings, and up to Rs 30,000 per beneficial owner for demat holdings, would be processed with minimal documentation.

According to Sebi, such a mechanism is needed because “the cost of documentation could be more than the value of securities being restituted as on the date of claim.”

Standardised documentation across intermediaries

The regulator said the current system often creates confusion because different intermediaries follow different procedures while handling transmission requests.

It noted that intermediaries, including listed companies, registrars and transfer agents (RTAs), depositories, depository participants and asset management companies, follow divergent practices “while processing transmission requests, thus placing uncertainties in the way of survivors claiming such securities.”

To address this, Sebi has proposed a uniform documentation framework for all intermediaries.

Simplified Process When No Nomination or Will Exists

Transmission becomes more complicated when the investor has not registered a nominee or left a will. In such cases, intermediaries usually seek more documents to avoid legal disputes.

Sebi acknowledged that these checks can make the process difficult for families. “For claimants already grieving a loss, this can feel like unnecessary harassment,” the regulator said.

To make the process easier, the regulator has proposed a risk-based documentation system based on the value of the claim.

For small claims under STP, claimants would only need to submit a transmission request form, client master list of the demat account, a verifiable death certificate and an officially valid identity proof, along with a simple undertaking.

For claims within the simplified documentation limits, claimants would be required to submit additional documents, such as a notarised indemnity bond and a no-objection certificate from other legal heirs or a family settlement deed.

Relaxation on Mandatory Probated Wills

Sebi has also proposed removing the requirement to submit a probated will in many cases where claims exceed simplified thresholds but are not disputed.

This follows recent legal changes under the Indian Succession Act, 1925, where mandatory probate requirements were abolished from December 20, 2025, for certain communities in Mumbai, Chennai and Kolkata.

The regulator said the change “makes probate optional, aiming to reduce costs and delays, harmonise laws, and simplify asset transfer.”

21-Day Timeline for Processing Claims

To ensure faster settlement, Sebi has proposed that intermediaries process transmission requests within 21 calendar days after receiving all required documents.

“The entity shall process the transmission case within a period not exceeding 21 calendar days… from the date of receipt of all the required documents associated with the claim,” the regulator said.