What is a collateral assignment and how does it affect my beneficiaries?
A collateral assignment is an agreement between the policyowner and another party (typically a bank/financial institution) where the policy is used to secure a debt. If the policy is collaterally assigned at the time of the insured’s death, the assignee must provide us with information showing their interest in the policy. The proceeds will be paid to the assignee as their interest appears. The remaining proceeds (if any) are paid to the beneficiaries.
