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What is Policyholder in Health Insurance?

Roocha KanadeJul 2, 2025

Policyholder in health insurance is a term you’ll often hear, but what exactly does that mean? Who are they and what do they do? We’ll break down what a policyholder is, what their key responsibilities are, who can be a policyholder, and why it’s important to know who holds that title.

Contents

Policyholder in Health Insurance
What role does a Policyholder play in health insurance?
Policyholder vs. Insured
Importance of knowing who the policyholder
Conclusion
Frequently Asked Question

Policyholder in Health Insurance

Simply put, a policyholder is the person who purchases an insurance policy and whose name is on the insurance document. This person applies for the plan, pays the premium, and has the legal right to make changes to the policy like adding dependents or beneficiaries.

Think of it like purchasing a family mobile data plan, if the plan is under your name and your family members use the shared benefits, you’re the one considered as the policyholder.

What role does a Policyholder play in health insurance?

Being a policyholder comes with responsibilities to ensure that the plan stays valid and effective. Here are some of the roles and responsibilities of a policyholder:

Timely payment of premium: The policyholder is responsible for paying the premium on time to keep the policy active and avoid coverage cancellation or penalties.

Managing the policy: Only the policyholder can make important changes to coverage options, updating address or contact information, and adding or removing beneficiaries.

Understanding the policy: The policyholder also needs to study and understand the policy to avoid confusion in the future and ensure that they are utilising the benefits to the fullest.

Filing claims: The policyholder is the one who files claims with the insurance company and assists the dependants in doing so as well.

Communicating with the insurance company :the policyholder becomes the point of contact for the insurance company and is responsible for inquiries regarding disputes or concerns.

Policyholder vs. Insured

While these two terms do appear to have similar meanings and are often confused, they do serve different purposes in an insurance policy.

For example if you take out an insurance plan for yourself, you are the policyholder and the insured. If you add your family members to this plan, they become the insured. They cannot be the policyholders of said plan.

Here’s a table that makes it a little easy to understand the difference between the two.

	Policyholder	Insured
Ownership	Is the owner of the policy	May or may not be the owner of the policy
Insured under the policy	Yes, unless chosen not to	Yes
Coverage	Covered by health insurance plan, unless chosen not to	Covered by health insurance plan
Point of contact	Is the point of contact for insurance company	Is not the point of contact for insurance company
Managing the policy	Manages payments, enrollment & claims	Does not manage payments, enrollment & claims
Payments	Pays the premium	Does not pay the premium

Importance of knowing who the policyholder

Knowing who the policyholder is more than a formality. It affects how a policy is managed and how benefits are accessed. Here are a few reasons why it matters:

Legal and financial concerns: Only policyholders can make changes or cancel a policy.
Handling claims: In many cases, policyholders are involved in filing or following up on claims.
Tax benefits: If you’ve got a health or life insurance plan, any tax benefits or deductions usually apply to the person who took out the policy, that is, the policyholder.
Dependents’ coverage: If you are a dependent, you need to know who the policyholder is in case you need to access documents, file a claim, or get clarity about your coverage.

Conclusion

In conclusion, insurance policies cannot exist without a policyholder. The policyholder is at the heart of any insurance agreement. Understanding this role helps clarify who has control over the policy, who can make changes, and who is ultimately responsible for keeping the plan active.

Whether you're shopping for insurance, reviewing a family plan, or simply trying to understand your coverage better, knowing who the policyholder is, and what they’re responsible for, is an important first step in understanding the world of insurance.

Frequently Asked Question

In this section, we will go over some of the most frequently asked questions about Policyholder in Health Insurance

1. Who can be a policyholder?

Any individual eligible to buy insurance can be a policyholder. For example, a policyholder could be an individual, a parent, spouse, or an employer. The policyholder is the person who owns the policy and is responsible for paying premiums as well as managing the plan.

2. Can there be more than one policyholder?

No, there’s usually only one legal policyholder per insurance policy. Other individuals are listed as dependents or beneficiaries, but they are not the policyholders.

3. What is the difference between a policyholder and the insured?

The policyholder is the person who owns and manages the insurance policy. The insured is the person who receives the coverage. They can be the same person, but not always. For example, when a parent purchases health insurance for their child, the parent becomes the policyholder, whereas the child becomes the insured.

4. Who is the policyholder in group insurance plans?

In group insurance, like employer-provided health plans, the employer or organisation is the policyholder. Employees covered under the plan are considered the insured members.

5. What happens if the policyholder passes away?

In health insurance, dependents may have the option to continue the policy or switch to a new one. If the policyholder is no more, then the insurance company pays out the benefit to the beneficiary listed in the policy at the end of the policy term. In cases where a decision is made to continue the plan, one of the insured members can become the new policyholder.