Question 1 of 19
How does an assignment of a life-insurance policy differ from a beneficiary change when the current beneficiary is revocable?
Strong Interview Answer
An assignment transfers ownership or specified policy rights from the owner to an assignee. A beneficiary change changes who is designated to receive the death benefit. If the assignment itself does not change the beneficiary, the beneficiary designation does not automatically change merely because ownership rights were transferred.
What to Listen For
- assignment transfers policy rights/ownership
- beneficiary designation controls death-benefit recipient
- revocable beneficiary generally lacks a veto over ordinary owner changes unless contract/law says otherwise
- assignment does not automatically equal beneficiary change
Caution
Look for a clear separation of ownership rights from death-benefit designation.