ASSUMPTION ENDORSEMENT Meaning and
Definition
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Assumption endorsement refers to a type of endorsement in the field of insurance, specifically in relation to claims. It is a clause or provision in an insurance policy that allows the insured party, also known as the policyholder, to transfer certain rights and responsibilities to another party, commonly known as the endorsee.
In an assumption endorsement, the policyholder essentially grants the endorsee the authority to step into their shoes and assume all entitlements and obligations associated with the insurance contract. This endorsement is typically utilized when an insured party wishes to transfer the benefits and liabilities of the policy to a third party, such as a related individual, corporation, or entity.
This type of endorsement may be sought in various scenarios, such as when an insured party is selling their assets or business and wishes to transfer insurance coverage to the purchaser. It can also be used if the insured party wants to delegate their rights under the policy to another individual or entity.
The assumption endorsement must be agreed upon by the insurance company as well, ensuring that all parties involved consent to the transfer of rights and obligations. It may require the endorsee to meet certain criteria, including demonstrating their financial stability and ability to fulfill the obligations associated with the policy.
In summary, assumption endorsement is an agreement within an insurance policy that allows the policyholder to transfer their rights and responsibilities to another party, usually when there is a change in ownership or when delegation of rights is desired.
Etymology of ASSUMPTION ENDORSEMENT
The term "assumption endorsement" does not have a specific etymology because it is composed of two separate words.
1. Assumption: The word "assumption" originated from the Latin word "assumptio" which means "a taking up". It entered the English language in the 15th century, and it refers to the act of taking or accepting something as true or valid without proof. The concept is derived from the verb "assume", which comes from the Latin verb "assumere", meaning "to take to oneself".
2. Endorsement: The word "endorsement" originated from the Medieval Latin word "indorsare" which means "to write on the back". It entered the English language in the 16th century, and it refers to the act of expressing approval, support, or agreement for something or someone.
