Arizona Adjuster Practice Exam

Which property insurance provision allows for the potential transfer of policy ownership?

1. Subrogation Provision

2. Assignment Provision

3. Exclusions Provision

4. Endorsement Provision

The correct answer is: Assignment Provision

The assignment provision is the correct choice because it specifically addresses the transfer of rights or ownership of a policy from one party to another. This provision permits the policyholder to assign the policy or a portion of the benefits to another entity, typically under certain conditions, such as notifying the insurer. This is important in property insurance contexts, as it helps to ensure that stakeholders in a property can access or transfer benefits related to the policy, which can be crucial in situations such as selling a property or when mortgage agreements are in place. In contrast, the other options do not serve the purpose of transferring policy ownership. The subrogation provision refers to the insurer's right to pursue a third party that caused an insurance loss after compensating the insured. The exclusions provision outlines what is not covered by the policy, focusing on limitations rather than ownership. Lastly, the endorsement provision involves modifications or additions to an insurance policy but does not pertain directly to the transfer of ownership of the policy itself.