Kaagazaat

Insurance Policy Assignment (Mortgaged Property)

At a glance

Price: Free till 31 Dec
Stamp duty: This Assignment is charged under Article 62(c) of Schedule I to the Indian Stamp Act, 1899 as applicable to Punjab (Schedule I-A), and under the equivalent entry in the Chandigarh Administration's own stamp schedule — the article that names, in terms, a "transfer... of any interest secured by a bond, mortgage-deed or policy of insurance".
Registration: Not compulsorily registrable in either Punjab or Chandigarh, on this drafting's own reasoning, though it has not been tested against a reported ruling on this exact instrument.
Witnesses: No statute requires this Assignment to be witnessed, because it is not ordinarily presented for registration in either Punjab or Chandigarh.

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Also called

insurance assignment agreement
deed of assignment of insurance policy
assignment of fire policy to lender
bank clause agreement
mortgagee's insurable interest agreement
loss payee assignment agreement
home loan insurance assignment
assignment of policy as collateral security

When you need it

Use this when a bank, NBFC, housing finance company or other lender has financed a purchase, or lent against a mortgage of a property, and its loan or mortgage documents require you to keep the property insured and to assign the benefit of that insurance to it for as long as the loan runs — so that if the property suffers a fire, theft or other insured loss while money is still owed, the insurance proceeds are applied first towards what you owe the lender, rather than being paid to you in full while the lender's security is destroyed. This Assignment is the borrower-lender record of that arrangement: what is assigned, to what extent, what you must do to keep the Policy alive, and how a claim's proceeds are to be split.

The substance of insurance law is the same everywhere in India. Whether the assignment of a life policy needs an endorsement under section 38 of the Insurance Act, 1938, and how an actionable claim like the benefit of a policy is transferred under section 130 of the Transfer of Property Act, 1882, does not depend on whether the mortgaged property is in Mohali or Manimajra — this Assignment states that position as it actually is. What Punjab and Chandigarh do decide is where this Assignment is executed, which stamp article applies to it, and which registering office's practice governs if the Parties choose to register it — covered in the formality notes below, stated for these two places exactly. Read this carefully before assuming it is the only route available. A property or fire policy is not assigned the way a life policy is: section 38 of the Insurance Act, 1938 governs only a policy of insurance on a person's own life, and does not reach this Policy at all. What actually binds the insurer here is its own recognition of the assignment — commonly given by an endorsement on the Policy noting the lender's interest (sometimes called a "bank clause" or a loss-payee endorsement) rather than by a separate stamped deed. Many lenders are content with that endorsement alone and do not ask for a document of this kind; others, particularly on a larger loan against property, want this fuller Assignment as a standalone security document as well. Check which your lender actually requires before assuming you need this Assignment rather than a simple request to your insurer to note the lender's interest. Not for assigning a life insurance policy — use the statutory endorsement under section 38 of the Insurance Act, 1938 instead, through your life insurer's own form. Not a substitute for the Mortgage itself, for the Loan documents, or for actually keeping the Policy renewed: an unrenewed or lapsed Policy leaves both the Assignor and the Assignee without cover, whatever this Assignment says.

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You can fill this one in on this site, and read the whole draft on screen before you decide anything about it. It is a carefully drafted template; it is not advice about your own facts.

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See stamp duty, registration and witnesses

What follows is written for Punjab and Chandigarh. It states the position there rather than describing how it varies, so the amounts below are the ones that apply — worth confirming at the sub-registrar’s office, because rates change. If the property is anywhere else in India, none of this is yours.

Stamp duty

This Assignment is charged under Article 62(c) of Schedule I to the Indian Stamp Act, 1899 as applicable to Punjab (Schedule I-A), and under the equivalent entry in the Chandigarh Administration's own stamp schedule — the article that names, in terms, a "transfer... of any interest secured by a bond, mortgage-deed or policy of insurance". That article charges the transfer at the same duty as a Bond (Article 15/1) for a sum equal to the amount or value of the interest transferred, and not at the ad valorem conveyance rate this platform's own Assignment of Commercial Lease template correctly applies to an assignment of leasehold rights in immovable property — the two are different named instruments under the Act, and this Assignment is the policy-of-insurance one, not the leasehold-conveyance one. The value on which that Bond-equivalent duty is computed is, on the ordinary reading of Article 62(c), the extent of the interest actually transferred by Clause 1.1 — that is, the amount for the time being due under the Loan, or the sum insured stated in Recital B, whichever the stamping authority treats as the value of the interest assigned — and this drafting has not found a reported ruling settling which of the two a Punjab or Chandigarh stamping authority will in fact take, which is worth raising at the counter before the stamp is bought. The current numeric Bond-equivalent rate under Punjab's Schedule I-A, and under the Chandigarh Administration's own schedule, could not be confirmed for this drafting against a dated, notified source — this is the single figure in this Assignment's stamping position most worth checking before the stamp is bought, at the Sub-Registrar's counter in Punjab or at the Sub-Registrar, 30 Bays Building, Sector 17 in Chandigarh, and it is the first item this template's drafter flags for a lawyer to check. Stamp before signing, under section 17 of the Indian Stamp Act, 1899; an Assignment found insufficiently stamped is inadmissible in evidence, under section 35 of that Act, until the deficient duty and a penalty of up to ten times it are paid.

Registration

Not compulsorily registrable in either Punjab or Chandigarh, on this drafting's own reasoning, though it has not been tested against a reported ruling on this exact instrument. Section 17(1)(b) of the Registration Act, 1908 reaches an instrument that purports to create, assign, limit or extinguish a right, title or interest of Rs 100 or more "to or in immovable property" — and the benefit of a policy of insurance is an actionable claim, transferred under section 130 of the Transfer of Property Act, 1882, not a right to or in the Property itself. The Mortgage recorded in Recital A carries its own registration position, stated in the template this platform uses for that instrument, and is unaffected by whether this Assignment is registered. The Parties may register this Assignment voluntarily, under section 18 of the Registration Act, 1908, where the Assignee's own policy asks for it, or out of caution given how little reported authority exists on this exact point — present it in Punjab to the Sub-Registrar of the tehsil where the Property lies, via igrpunjab.gov.in, and in Chandigarh to the Sub-Registrar, 30 Bays Building, Sector 17, via revenue.chd.gov.in, within four months of execution under section 23 of that Act.

Notarisation

Not required to give this Assignment effect between the Assignor and the Assignee, and does not substitute for {{insurer_name}}'s own endorsement and written acknowledgment under Clause 1.3 — a notary's seal on this Assignment says nothing to {{insurer_name}} that a plain written notice does not already say. Some lenders' own panels ask for a notarised copy to be filed with their security documents in Punjab or in Chandigarh alike; where that is asked for, use a Notary Public or an Oath Commissioner in the ordinary way.

Witnesses

No statute requires this Assignment to be witnessed, because it is not ordinarily presented for registration in either Punjab or Chandigarh. Given that it is used as bank security, two witnesses — adults, not the Parties or their signatories — remain good practice, and the signature block provides for them. If the Parties do register this Assignment, the same identifying-witness practice the Mortgage itself was registered under applies again.

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INSURANCE POLICY ASSIGNMENT (MORTGAGED PROPERTY)

This Deed of Assignment (this "Assignment") is made at Chandigarh on 3 April 2026.

BETWEEN

Manpreet Singh Dhillon, an individual, of House No. 812, Phase 7, Mohali 160062, PAN AFZPD4321L (the "Assignor", which expression includes the Assignor's heirs, executors, administrators, successors and permitted assigns);

AND

Sarvodaya Housing Finance Limited, a banking company as defined in the Banking Regulation Act, 1949, of SCO 191-192, Sector 34-A, Chandigarh 160022 (the "Assignee", which expression includes its successors and assigns).

The Assignor and the Assignee are each a "Party" and together the "Parties".

RECITALS

A. By a registered Mortgage Deed dated 1 April 2026, registered as document No. 1187, Book No. I, Volume No. 3312 (the "Mortgage"), the Assignor mortgaged the property at House No. 812, Phase 7, Mohali 160062, situated in the State of Punjab (the "Property"), to the Assignee as security for Loan Agreement No. HL-2026-4471 dated 3 January 2026, under which the Assignee has sanctioned or disbursed to the Assignor a loan or credit facility of ₹42,00,000 (Rupees Forty Two Lakh only) (the "Loan").

B. The Assignor has insured the Property, or the structure and/or contents at the Property, under Policy No. FIRE/2026/0071144 (the "Policy"), being a Standard Fire and Special Perils Policy, issued by Sarvodaya General Insurance Company Limited, for the period from 2 April 2026 to 4 April 2026, both dates inclusive, for a sum insured of ₹45,00,000 (Rupees Forty Five Lakh only), covering the residential house standing on the Property, together with its fixtures and fittings.

C. The Loan and Mortgage documents require the Assignor to keep the Property insured throughout the term of the Loan, and to assign the benefit of the Policy to the Assignee as further and collateral security for the Loan, and the Assignor has agreed to do so on the terms of this Assignment.

D. The Policy has not previously been assigned, charged or encumbered in favour of any person.

E. No claim is pending under the Policy as on the date of this Assignment.

IT IS AGREED AS FOLLOWS

1. ASSIGNMENT

1.1 The Assignor, as the person entitled to the Policy, hereby assigns to the Assignee, by way of security only and not absolutely, all the Assignor's right, title, benefit, interest and claim, present and future, in and to the Policy, including every sum that may become payable under it on the happening of any event insured against, to the extent of the amount for the time being due and owing by the Assignor to the Assignee under the Loan.

1.2 This Assignment is a transfer of an actionable claim within the meaning of section 130 of the Transfer of Property Act, 1882, is made in writing signed by the Assignor, and takes effect between the Assignor and the Assignee from the date of this Assignment.

Questions about this document

Does the Insurance Policy Assignment (Mortgaged Property) need stamp paper or stamp duty in Punjab and Chandigarh?

See the full position on stamp duty, registration and witnesses

Does the Insurance Policy Assignment (Mortgaged Property) need registration in Punjab and Chandigarh?

Not compulsorily registrable in either Punjab or Chandigarh, on this drafting's own reasoning, though it has not been tested against a reported ruling on this exact instrument.

See the full position on stamp duty, registration and witnesses

What does the Insurance Policy Assignment (Mortgaged Property) cost on Kaagazaat?

Free till 31 Dec.

Launch period: downloads are free until 31 December. Nine everyday papers stay free for good.

Does the Insurance Policy Assignment (Mortgaged Property) need witnesses?

No statute requires this Assignment to be witnessed, because it is not ordinarily presented for registration in either Punjab or Chandigarh.

See the full position on stamp duty, registration and witnesses

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