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
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Acknowledgment by the policyowner that he or she has received the policy loan requested. ...
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Group of women life insurance agents who sell sufficient insurance to qualify for membership. The round table is sponsored by the NATIONAL ASSOCIATION OF LIFE UNDERWRITERS (NALU). ...
Acceptance by a reinsurer of part or all of a risk that has been transferred to it by a primary insurer or another reinsurer. ...
Right of an insured to make additional purchases of life insurance without having to take a physical examination or show other evidence of insurability. Additions can be bought at stated ...
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