An assignment transfers the right to pursue a claim. In insurance contexts a defendant may assign its claims against its insurer to the plaintiff in exchange for a covenant not to execute.
Assignability varies by claim type and jurisdiction.
Alternative Names:
Claim Assignment, Assignment of Rights
Why it Matters?
The consent judgment and assignment structure is the mechanism by which a coverage dispute reaches the carrier, since an insured facing an uncovered judgment assigns its bad faith claim to the plaintiff who then pursues the insurer directly. Several states restrict or scrutinize these arrangements, particularly where the insurer was defending under a reservation and the insured cooperated in an inflated judgment. Personal injury claims are generally not assignable.
Frequently Confused with
Related terms
Frequently asked questions
What is the typical insurance assignment structure?
Are all claims assignable?
