If the policy is assigned, the assignee receives the claim amount as per rules. It should be noted that an assignment of a policy automatically cancels the existing nomination.
Hence, when such a policy is reassigned in favour of the policyholder, it is necessary to make a fresh nomination to avoid delay in payment of the claim.
Assignment:
- Assignment means transfer of rights, title and interest.
- When an assignment is executed, all rights, title and interest in respect of the property assigned are immediately transferred to the Assignee/s and the Assignee/s become the owner/s of the policy subject to any lawful condition made in the assignment.
- Assignment can be either conditional or absolute.
- On assignment, Nomination automatically stands cancelled.
- Hence, when such a policy is reassigned, the policyholder will have to make a fresh nomination to avoid delay in settlement of claim.