Married Women's Property Act, 1874 (MWP Act)

Starting a family is quite a responsibility. While people do so, they consider buying term life insurance to financially protect their partner and children in case anything were to happen to them. However, what if your family couldn’t get access to the said benefit, especially when it’s their sole backup?

At times, the financial burden of managing daily expenses and future requirements can take a toll on your family members. For those who have taken a huge loan or are running a business in debt, the creditors or lenders can claim the sum assured of the term plan. In such a situation, your family is left with little to nothing in hand when you have been paying the premiums to financially secure their needs.

However, you have got nothing to worry about due to the MWP Act. To avoid such a situation from affecting your spouse and children, you can purchase term life insurance under the Married Women’s Property Act, (MWPA) 1874. In this article, let’s understand the details of the MWP Act and how your loved ones can benefit from it.

What is the Married Women’s Property Act, 1874?

According to Section 6 of the Married Women’s Property Act, 1874, a married man in India can buy term insurance under his name to benefit his wife and/or children if anything were to happen to him. The beneficiaries stated in the policy will most certainly receive the sum assured amount upon the death of the policyholder. But isn’t this how term insurance payout usually works?

Normally, in case the policyholder has pending debts under his name, the creditors can claim the death benefit to cover the owed amount. But then the family of the policyholder is left without any financial help as they cannot claim the sum assured of the plan. Thus, if the insured purchases insurance under the MWP Act, the death payout cannot be claimed by any other creditor or lender.

Who Can Opt for Term Insurance Under the MWP Act?

Any man who is living in India can get a term life insurance plan under the Married Women's Property Act. Widowers or divorcees can buy this policy under the MWPA as well, to ensure that the benefit goes to the children.

However, remember that you have to buy the policy under your name so that your wife and/or children can avail the benefits under it. Moreover, if the wife and the husband were to divorce after getting insurance under the MWP Act, the beneficiaries shall remain unchanged. So, no other family member or creditors can lay a claim over the policy payout.

What Other Benefits Does the MWP Act Offer?

One cannot avail a loan on the life insurance plans endorsed under the Married Women’s Property Act, 1874. If you were to surrender a cash-value policy, the benefits earned under it will go to the respective beneficiaries after the policy surrender. Moreover, if you were to survive the policy tenor, the maturity benefits would be given to the enlisted beneficiaries of the policy.

Who Should Opt for MWP Act, 1874?

The following kinds of individuals should definitely opt for term life insurance under the Married Women’s Property Act:

• Policyholders who want to safeguard their wife’s and/or children’s claim on the policy proceedings

• Salaried individuals, businessmen and other people who have pending debts to their name

• Individuals who want to ensure their dependents get the insurance payout in their absence

Who can be the Beneficiaries of the MWP Act, 1874?

The beneficiaries of your term insurance policy that is covered under the Married Women’s Property Act can be:

• Policyholder’s wife

• Policyholder’s children or a child

• Policyholder’s wife and children

Furthermore, the insured can dedicate a specific percentage of the sum assured to each of the beneficiaries of the policy or divide the amount equally.

What Other Laws did the MWP Act Enact?

• Ownership Over Earnings

The MWP Act discusses how married women’s earnings are to be their own property. Irrespective of what employment, occupation, or trade is carried on by a woman, if it is independent of her husband, the wages and earnings will be hers alone.

Money or property acquired by a woman through her skills/talent (literary, artistic, or scientific) is also her separate property. All the savings and investment from any income a woman has, too, is her separate property.

• Life Insurance Policies in the Name of Married Women

Before the introduction of the MWP Act, if a man died without clearing all his dues, his creditors could lay claim on any assets he left behind. This includes immovable and movable property, cash, and even amounts paid to his survivors through life insurance policies.

The Married Women’s Property Act, through Section 6, changed this, qualifying assured sums from life insurance policies under the act as property of a man’s wife and children, and not a part of his assets or estate.

• Right to Opt for Insurance

Another essential part of the MWP Act discusses how married women possess the right to take out insurance policies independently. The policy and the arising benefit will be the woman’s property alone, and for the purpose of the insurance contract, the policy would be valid just as it would have been if the woman was unmarried (because married women couldn’t enter into contracts independently).

• Power to Initiate Legal Proceedings

The MWPA empowers women to initiate legal proceedings. This was inserted to provide women with a means to go to court to recover their separate property (acquired under either the Married Women’s Property Act or the Indian Succession Act).

This section states that all remedies that an unmarried woman would have, civil and criminal, are available to a married woman for the protection of her property.

• Liability for Post-Nuptial Debts

The Married Women’s Property Act, 1874 discusses post-nuptial debts. In addition to setting out women’s rights, the act also sets out their liabilities. This section particularly deals with contracts or agreements entered into by married women regarding their property. A person who enters into an agreement regarding a married woman's property has the right to sue her and recover whatever they would have if the woman was unmarried.

• Husband’s Liability for Ante-Nuptial Debts

Furthermore, the MWP Act, 1874 talks about how the husband is not liable for debts contracted by his wife before their marriage. It also mentions that for the purposes of debt taken, the liability of a married woman (to be sued, etc.) shall remain the same just as it would be if she was unmarried.

• Husband’s Liability for Breach of Trust or Devastation

The liability of a husband when his wife is a trustee or executor is also explained under the MWPA. If the husband is not involved in the affairs of the trust, he will not be liable for any breach of trust committed by her or damage caused to the estate by her.

Parting Thoughts!

We often worry about the financial security of our family in our absence, especially when one has pending loans. Buying term life insurance plans under the Married Women’s Property Act, 1874, shall ensure that your loved ones are financially protected no matter what!

Moreover, endorsing life insurance under the MWP Act protects the benefits from being utilised for the repayment of loans and is dedicated to the financial well-being of the beneficiaries. So, ensure your dependents have the right monetary backup by heading over to Bajaj Markets now! Browse through the term insurance plans available on our platform and get maximum coverage.