A life insurance policyholder can transfer
rights of the policy to another person with certain conditions. This is known
as conditional assignment of life insurance policy. The policyholder's rights
are restored once conditions are fulfilled. The policyholder is the assignor
and the person to whom the policy is assigned is the assignee.
It can be obtained from the insurance company
or agent. Assignor and assignee details must be filled. It will indicate the
condition for assignment, percentage of sum assured assigned, reason for
assignment and who will pay the future premiums.
The assignor and the assignee are required to
provide a declaration to the insurance company in the specified format. The
assignor's declaration will state that the assignment is being made on his
own volition and not for the purpose of trading. The assignee's declaration
will state that in case the assignee predeceases the assignor, or the
assignor survives the policy term, the amount will be payable to the
Original policy must be enclosed with the form,
supported by the following
documents of the assignee:
Self-attested income document
Copy of self-attested photo ID proof and address proof
Self-attested copy of PAN Card
Once the required documents and forms are
submitted to the insurance company and verified, the insurer will record the
conditional assignment. Upon payment of a prescribed fee, the assignee can
obtain an acknowledgement of notice of assignment from the insurance company.
This serves as conclusive evidence against the insurance company that it has
received the notice of conditional assignment.
Points to note
Policies issued under the Married Women
Protection (MWP) Act cannot be assigned.
The assignee has the right to surrender the
policy if the conditions are not fulfilled by the assignor.
Assignment automatically cancels any nomination
registered against the insurance policy.