Definition - What does Policyholder mean?

A policyholder is a person or entity who owns an insurance policy and has the privilege to exercise the rights stated in the contract. This party is often, but not always, the insured, and they may or may not be the only or one of the policy's beneficiaries.

Insuranceopedia explains Policyholder

An insurance policy, being a contract in its nature, requires at least two parties. One of the parties is the insurer, which is the insurance firm, and the other is the policyholder who agrees to the specified terms for coverage. Depending on the contract, the policyholder may be the holder of the policy, but the insured or beneficiary could be another party. For instance, a businesswoman could purchase a life insurance policy on the life of her business partner and name herself as the beneficiary. In this case, she is a policyholder and a beneficiary, but not the insured.

As an entity signing a contract, the policyholder has several obligations to the insurer. These include the provision of all and accurate information for underwriting purposes, honoring the agreed specific terms, and paying the required premiums. Simply stated, a policyholder is a person or entity whose name appears on the records of the insurance firm.

Share this:

Connect with us