New Delhi, April 14 -- The Securities and Exchange Board of India (Sebi) guidelines require mutual fund investors and demat account holders to either register a nominee or formally opt out of nomination. Sebi introduced this rule to ensure that every investor explicitly records their choice, ensuring that the nominee can claim the securities in the event of the owner's death.

Under these guidelines, investors cannot leave the nomination field blank. They either have to submit a nominee's details or a signed declaration to opt out at the time of opening an account or for existing folios.

If you opted out of appointing a nominee, the holdings do not lapse. But there is a process in place to transfer the securities to the rightful claimant...