Transfer By Endorsement

What Does Transfer By Endorsement Mean?

A transfer by endorsement refers to the legal transfer of a negotiable instrument from one party to another by signing a document. In the context of an insurance policy, this transfer typically pertains to the policy’s proceeds. The endorsement, in this case, serves as a policy endorsement attached to the insurance policy to formalize the transfer.

Insuranceopedia Explains Transfer By Endorsement

Another example of a transfer by endorsement is mortgage redemption insurance. In this case, a portion of the insurance proceeds, equal to the outstanding loan amount, is transferred to the mortgagee (the bank) upon the insured’s death. This transfer is formalized through an endorsement in the insurance policy, signed by the insured, which assigns the specified amount to the bank in the event of the policyholder’s death.