Assignment Clause, Life Insurance
Feature in a life insurance policy allowing a policyowner to freely assign (give, sell) a policy to another or institution. For example, in order to secure a loan, a bank asks to be assigned the policy. If the insured dies before repayment of the loan, the bank would receive a portion of the death benefit that equals the outstanding loan, the remainder of the death benefit being payable to the insured's beneficiary. The fact that life insurance is freely assignable makes it a useful financial instrument through which to secure a loan. The insurance company does not guarantee the validity of the assignment.
Popular Insurance Terms
Statistics (such as health data from physical examination of employees or other insureds) used as a benchmark from which deviations and comparisons of expected losses, as well as future ...
largest amount of reinsurance available from a company or from the general market; large amounts of reinsurance on one risk; or maximum premium volume that can be written by a reinsurer. ...
Rule that provides four requirements for monitoring the independent agent distribution system: The insurance company must be involved in the training of the independent agent. The ...
Former arrangement under which retirement benefits payable to an employee who continued to work beyond normal retirement age were frozen, and not increased in recognition of added work ...
Exchange, in insurance, of an adequate consideration (premium paid by an insured) for the promise of an insurance company to pay benefits in the event the insured incurs a loss. ...
Yearly renewable term (YRT) life insurance under which an insured can usually re-apply for term insurance every fifth year at a lower premium than the guaranteed renewal rate. If the ...
Insurance policy that differs from the standard form. ...
When we are young, we usually don’t take our retirement seriously and don’t even know the definition of an Individual Retirement Account (IRA). We become more preoccupied with ...
Type of trust established for the purpose of permitting the federal estate marital deduction for assets transferred from the decedent's estate to a surviving spouse who is not a citizen of ...
Have a question or comment?
We're here to help.