What is a policyholder for insurance?
While there’s no such thing as a dumb question, there are some pretty embarrassing questions. Case in point: what’s the longest you’ve gone without a shower? And perhaps related: When’s the last time you showered? (This morning, Mom!!) Or the unrelated but equally embarrassing: Would you rather be caught picking your nose or picking a wedgie?
But when it comes to insurance, there’s no such thing as a bad or embarrassing question — especially because there’s so much confusing terminology. And that’s why we’re here to answer an essential question about insurance: What is a policyholder?
In short: the policyholder is the person who purchases and owns the policy, regardless of the type of insurance in question. When you buy a policy under your name, you become the policyholder, and in most cases, you’re the one who is covered by the insurance outlined. But sometimes, that’s not the case (we’ll get into that shortly). And what if you want to have multiple people under one policy? Strap yourselves in: we’re diving head-first into policyholder territory!
What are Policyholder Rights & Responsibilities?
As the policyholder, you’re responsible for timely payments on your premiums (whether they’re monthly, semi-annual, or annual). Paying your insurance premiums on time ensures that you don’t owe interest or go into debt, and it also keeps your coverage from lapsing.
You’re liable for maintaining proper policy documentation, which means you’ll also need to keep all your information up to date. In the event of a major life change like a marriage, a new family member, or a death, you’ll want to update your policy accordingly.
In addition, you need to comply with the policy terms and conditions. If you have any doubts or if anything in the policy itself seems unclear, contact your insurance agent and ask for clarification.
And finally: the policyholder has the right to appeal in the event that they’re not happy with a decision made by the insurance provider during the claims process.
What Can Insurance Policyholders Do?
As the policyholder, you own the policy, which means that you have the right to make changes to that policy — up to a point, that is, since unfortunately, the insurance provider probably won’t pay you to have insurance.
When you’re the boss, you’re in charge. Here are some things that you are entitled to do:
- Obtain a copy of your insurance policy
- Cancel your insurance policy
- Change or update the insurance policy
- Add as many beneficiaries to your insurance policy as allowed by the provider
- Make an insurance claim
- Appeal your insurer’s decision
Are Policyholders the Only Ones Covered By A Policy?
The answer is no — or at least, not always. Policyholders can cover others, but how they do so depends on the type of insurance. In some cases, as with health insurance, your policy may automatically cover your immediate family. In other cases, as with renters insurance, you may need to add additional coverage if you wish to cover other people with your policy. Let's take a look at a few examples:
In most cases, the person whose life is insured is also the policyholder, but that doesn’t always hold true. For example: Your life may be insured, but your spouse could be the policyholder. And this doesn’t even get into the beneficiary, or the person who receives the death benefit.
Adding a beneficiary is a key part of getting life insurance, since the whole reason you’re likely getting life insurance in the first place is to make sure that your loved ones will be taken care of in the event of your death. As the policyholder on a life insurance policy, only you have the right to add, remove, or replace a beneficiary. And because you own the insurance policy, only you can increase or decrease the amount of coverage.
In short: It’s confusing, but with life insurance, several different people can partake in the policyholder-beneficiary-insured relationship.
If you have homeowners insurance, your policy will cover family members and other residents living in the same house. The policy reimburses the policyholder’s and household’s personal property losses up to the policy’s limit.
A renters insurance policy may cover your spouse and kids living with you, but not everyone living in the same house. Your rental insurance policy will not automatically include your roommates or any extended family members, like, for instance, your grandparents. That said, you can work with your insurance agent to add them to your policy, or they can buy their own renter insurance.
If you’re involved in an accident, your auto insurance policy will cover all the passengers inside the car. You can also add additional drivers to your auto insurance policy, which is good news for parents of teenage drivers, for example. Your car insurance can also cover members of your family if their car is registered to the same address as yours. In fact, many insurers allow a household to cover up to five cars on the same policy.
Find the Best Policyholder Coverage with Marble
When you’re the policyholder, your job is to maximize your coverage — and because you’re protecting the most important things and people in your life, you’ll want to make sure you’re getting the right coverage for your needs. That’s why we recommend reading through a company’s reviews and shopping around for multiple quotes before purchasing any policy.
You can use Marble’s insurance comparison tool to get free quotes for insurance policies, compare insurance rates, and find the best coverage for both you and your dependents.
Sign up for Marble, where you can keep all your insurance policies organized on one single platform. Whether you’re looking to buy a life insurance policy, car insurance policy, or some other policy entirely, Marble is here to help.