State RegulationsFL specificDifficulty 1/5
What is the effect of an absolute assignment of a Florida life policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under Chapter 627, Florida Statutes, an absolute assignment transfers the entire ownership interest in the policy - the right to name beneficiaries, take policy loans, surrender the policy for its cash value, and collect living benefits - from the assignor to the assignee. It is not a loan security device (that is a collateral assignment), and it is not a method of naming beneficiaries or splitting proceeds.
Why the other options are wrong
- B) Keeping all ownership rights while securing a loan describes a collateral assignment, not an absolute one.
- C) Beneficiary changes are made under the policy's change-of-beneficiary provision, not by assignment.
- D) Splitting a death benefit is done through multiple beneficiary designations, not an assignment.
Memory hook
Absolute assignment hands over the whole policy - keys and all.