InvestorQ : What is meant by ‘assignment’ of a policy?
Monali Shah made post

What is meant by ‘assignment’ of a policy?

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Purvesh answered.
2 years ago

An assignment is a term in insurance used for transferring benefits of policy to a lender for taking a loan.
In an event of the death of the policyholder, benefits will be paid to the assignee and rest to the nominee of the policyholder.
Such assignments are famous while taking a Homeloan where the policy is taken in the name of the person taking a Housing loan.
The assignment of Insurance Policy is mainly of two types:
1) Absolute assignment - There are no conditions apply and complete transfer of benefits happen's.
2) Conditional Assignment - The benefits mainly transfer as per the conditions mentioned in bond.