上海交通大学金融学专业保险学原理讲义chapter10.pptVIP

Transfer of ownership by assignment Collateral assignmentis a temporary assignment of the monetary value of a life insurance policy as collateral-or-security- for a loan. Transfer of ownership by assignment A collateral assignment differs from an absolute assignment in three general respects:1.the collateral assignment’s right are limited to those ownership rights that directly concern the monetary value of a policy. The policyowner retains all ownership rights that do not affect the policy’s value.the policyowner-assignor, however, is not permitted to take out a policy loan or surrender the policy for its cash surrender value while a collateral assignment is in effect unless the assignee consents. Transfer of ownership by assignment 2 the collateral assignee has a vested right to the policy’s monetary value, but the right is limited.Limited to the amount of the assignor ‘s indebtedness to the assignment . If the policy proceeds become payable, the assignee is entitled to receive only the amount of indebtedness. Transfer of ownership by assignment 3 the collateral assignee’s rights to the policy values are temporary.If the assignor repays the amount owed to the collateral assignee, the assignment terminates, and all of the policy’s ownership rights revert to the policyowner. Transfer of ownership by assignment Problems resulting from assignmentthe most common problem occurs when the insurer is not notified in writing of an assignment. Transfer of ownership by assignment Example Isabel collaterally assigned the insurance policy she owned on her life as security for a loan. When Isabel died, the insurance company had not been notified of the assignment, and, thus, it paid the policy proceeds to the named beneficiary. The assignee later claimed the policy proceeds. Transfer of ownership by assignment Analysis because the insurer was not noticed of the assignment before it paid the policy death benefit, it has no liability to pay the proceeds again to th