Collateral Assignment
Definition of "Collateral assignment"
Designation of a policy's death benefit or its cash surrender value to a creditor as security for a loan. If the loan is not repaid, the creditor receives the policy proceeds up to the balance of the outstanding loan, and the beneficiary receives the remainder. Because life insurance is freely assignable it is readily acceptable to lending institutions as security. Also, the lender is certain to receive the money should death strike the borrower before the loan can be repaid.
Popular Insurance Terms
Organization of insurance broker and agent associations that includes the Independent Insurance Agents of America, National Association of Professional Insurance Agents, National ...
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Value in life insurance policies that entitle the insured to these choices: to relinquish the policy for its CASH SURRENDER VALUE. (Note that in the beginning years the cash value may be ...
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Portion of a life insurance policy cash value after the deduction of all the policyowner's indebtedness. ...
Numerous automotive vehicles covered under a common insurance policy. ...
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