When policyholders agree to transfer their insurance proceeds to another entity after a loss, what is this arrangement known as?

The arrangement in which policyholders agree to transfer their insurance proceeds to another entity after a loss is known as assignment. In this context, assignment refers to the policyholder’s right to assign or transfer their right to receive the benefits from the insurance policy to a different party, often after the occurrence of a loss. This can occur in various situations, such as when a contractor requests payment directly from the insurer for work done on behalf of the policyholder.

Subrogation, on the other hand, is a process through which an insurance company seeks to recover costs from a third party responsible for a loss after they have paid the insured. Endorsement refers to modifications made to an insurance policy's terms, conditions, or coverage but does not involve the transfer of proceeds. Transfer of risk generally describes the concept of managing exposure to loss but does not specifically pertain to the transfer of benefits or proceeds after a loss has occurred. Therefore, assignment is the most accurate term for this scenario.