Collateral Borrower
Individual who assigns rights to a benefit. For example, a life insurance policy may be assigned as security for a loan made by the borrower. The policy protects the collateral creditor (assignee) if the borrower does not pay the loan when due. If a loan remains unpaid at the death of an insured, the loan balance is subtracted from the death benefit and paid to the creditor, with the balance going to the insured's beneficiary. On the other hand, if the insured (the borrower) does not pay the loan when due, the creditor can withdraw the amount due from the cash value of the policy. When a loan is repaid, the assignment ends and the policy owner is again vested with all rights to the policy.
Popular Insurance Terms
Expenses and taxes incurred by the insurance company resulting from the normal business activities of the company before the due date of the annual statement. ...
Organization of trial attorneys who specialize in the representation of defendants who become subject to tort actions. Generally, these tort actions involve bodily injury or personal injury ...
Hospital insurance program that provides medical professional liability insurance coverage to non employed hospital physicians. The objective of this means of insurance coverage is to ...
Exemption in ocean marine policy for losses caused by strikes, riots, and civil commotion. ...
Amount of combustible matter present that can act as a fuel to feed a hostile fire. ...
Hybrid between facultative reinsurance and treaty reinsurance where the ceding company may elect to assign certain risks that the reinsurer is obligated to accept. ...
Same as term Canadian Institute of Actuaries: ...
Circumstance in which no agent is servicing a debit. ...
Period of time during which notice of claim and proof of loss must be submitted by the insured or his or her legal representatives. ...
Have a question or comment?
We're here to help.