South Carolina Personal Lines Practice Exam

What is required for an assignment to be valid in property and casualty policies?

1. Verbal approval from the insurer

2. Written consent of the insurer

3. Notification from the insured only

4. No requirements if the assignee is a family member

The correct answer is: Written consent of the insurer

For an assignment to be valid in property and casualty policies, the written consent of the insurer is crucial. This requirement is in place to ensure that the insurer is aware of and agrees to the change in policy ownership or the beneficiary of benefits. A written consent serves as a formal acknowledgment by the insurer, which protects both parties involved in the assignment and upholds the integrity of the contract. Without this written approval, assignments can lead to disputes or complications regarding coverage, claims, and responsibilities. The insurer may have specific criteria for who they will underwrite, and a policyholder cannot simply transfer rights or obligations without the insurer's concurrence. Therefore, securing written consent is essential for safeguarding all parties' interests.