Assignment is defined as?

Assignment is defined as?

• A. A change in policy beneficiary only.
• B. The transfer of ownership rights of a policy to another party.
• C. A designation of multiple primary beneficiaries.
• D. A temporary suspension of policy benefits.

Answer: (B)

Assignment means transferring ownership rights of a life insurance policy to another party. When ownership is assigned, the new owner gains control over the policy and its proceeds, which is different from simply changing who is named as a beneficiary. There are two common forms: absolute assignment, where all ownership rights are transferred, and collateral assignment, which temporarily transfers rights to secure a loan while the owner still retains other aspects of the policy. The described choice matches this definition by focusing on the transfer of ownership rights. The other options describe changing beneficiaries or suspending benefits, which do not constitute ownership transfer.

Assignment means transferring ownership rights of a life insurance policy to another party. When ownership is assigned, the new owner gains control over the policy and its proceeds, which is different from simply changing who is named as a beneficiary. There are two common forms: absolute assignment, where all ownership rights are transferred, and collateral assignment, which temporarily transfers rights to secure a loan while the owner still retains other aspects of the policy. The described choice matches this definition by focusing on the transfer of ownership rights. The other options describe changing beneficiaries or suspending benefits, which do not constitute ownership transfer.