Also known as: assignment insurance definition · assignment of insurance policy
The transfer of your rights or interest under an insurance policy to another party, which most commercial policies allow only with the insurer's written consent.
Assignment is the transfer of your rights or interest in an insurance policy to a different party. Because an insurer underwrote the risk of a specific insured, most commercial policies contain an assignment condition stating that you cannot assign the policy without the carrier's written consent. This matters most in M&A and financing: when a startup is acquired or its assets change hands, its policies do not automatically follow the business unless the insurer agrees to the assignment. A separate concept, the assignment of claim proceeds after a loss has occurred, is treated more leniently because the risk has already crystallized.
Assignment means transferring your rights or interest under the policy to another party. Because insurers price coverage around a specific insured, the policy's assignment condition usually requires the carrier's written consent before any transfer is valid. Without that consent, an attempted assignment generally has no effect and can jeopardize coverage.
Not automatically. Most commercial policies bar assignment without the insurer's written approval, so an acquirer usually cannot simply inherit your D&O, Cyber, or Tech E&O policy on close. In practice the parties either obtain the carrier's consent to assign, add the new entity by endorsement, or arrange fresh coverage and a run-off or tail policy for the pre-close period.
Assigning the policy transfers the coverage itself and requires the insurer's consent because it changes who the risk protects. Assigning claim proceeds, by contrast, only directs payment of an existing, already-incurred loss to another party, and insurers generally allow it because the underwritten risk has already occurred.
Definitions are educational and may be modified by your specific policy language, endorsements, and state rules. For regulatory guidance, refer to the California Department of Insurance or the NAIC.
Last updated: July 2026.