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Rajeev always assumed his dad was the one managing their family’s health insurance until reality caught up with him. When his father was rushed to the hospital, the claim process got stuck midway. Why? Because Rajeev, not his dad, was listed as the policyholder, and no one else could authorise the treatment.
Sounds like an insignificant detail, right? But in the world of health insurance, this minor fact can make or break your access to treatment and insurance benefits.
So, let’s clear up this confusion.
- Who is the policyholder?
- Does it matter significantly if you’re just listed as “insured”?
- Can something as simple as a title affect claims, tax benefits and renewals?
The answer is yes.
This blog simplifies what a policyholder is, what they can do, and why it’s a title that shouldn’t be overlooked.
What does being a Policyholder Mean?
The policyholder is the individual or entity who owns the insurance plan, pays the premium, and has their name on the policy. They are the official owners of the policy and the one responsible for keeping the health insurance plan active by paying the insurance premium.
While they’re often the ones being insured, that’s not always the case. For instance, a parent/guardian can purchase a health plan for their children. In this case, the parent is the policyholder as s/he pays the premium and manages the plan, while the child is the insured receiving the medical coverage benefits.
You can consider the policyholder as the captain of the insurance ship who steers coverage, manages claims, and keeps everything on course. From paying insurance premiums on time to keeping your insurance provider in the loop about life updates, their vital role keeps the medical coverage alive.
A closer look at the role and responsibilities of a policyholder:
Accurate Disclosure of Information
A health insurance plan depends on trust. That’s why IRDAI insists on accurate disclosure under the Principle of Utmost Good Faith. It’s not just paperwork; it’s the backbone of trust that supports your insurer relationship. Every detail you share allows insurers to assess risk accurately and create an ethical policy to safeguard you when it matters the most.
Timely Premium Payments Matter
One missed premium payment could cost your coverage. Your insurance policy is specifically curated to safeguard you, but only if you keep the policy funded with timely premiums. Missing even one can disrupt your medical coverage in the crucial time of a medical crisis. Your policy depends on timely payments, and missing one could interrupt your coverage.
Understanding Policy Terms
Insurance is undoubtedly not a mystery, but the details mentioned in your policy document define your protection. This small print mentions everything from exclusions to claiming conditions that make all the difference when it’s time to use your health plan. Skipping over the terms may leave you guessing at the worst possible moment.
Keeping Information Updated
Any life changes? Your health plan should know too. The right info at the right time saves you later. Whether it's a phone number, change of address or updated health status, keeping your information up to date ensures faster communication and support. If your data isn’t updated, your claim might face complications or denial.
Do you know: Insurance companies rejected claims totalling ₹15,100, which is approximately 12.9% of the total, due to errors, incomplete documents or failure to comply with policy terms, as mentioned in Business Standard.
Prompt Notice
A policyholder must understand that the clock starts ticking the moment something goes wrong. Insurers work best when the policyholder acts fast. Delaying their report could cost them the support they need. Reporting the incident promptly helps their claim move faster and could stop the situation from escalating further.
Mitigating damage
Insurers prioritise proactive health management as it minimises risks and claims. Healthy habits, informed decisions, and preventive care. It’s a win-win where the policyholder stays healthier and the insurer manages reduced risks and costs. Even IRDAI supports insurers rewarding the insured members who follow wellness guidelines as per IRDAI.
Understanding your role makes your coverage stronger. You’re already halfway to being a truly empowered policyholder.
Policyholder vs. Insured Person: Key Differences
If you still think that “policyholder” and “insured” are just interchangeable terms, it’s time to rethink. Knowing the difference between both roles helps you avoid confusion and make the maximum of your insurance coverage.
Let’s bring this to life with a case study.
Case Study: Who Owns the Policy?
Background: Arjun Chaturveji, a devoted son-in-law, had been paying the health insurance premium for his in-laws as a gesture of care, assuming he was doing his part in protecting the family’s health.
The Incident: However, when Arjun faced a sudden medical crisis and needed hospitalisation, he confidently reached out to claim cashless benefits. Little did he know that he was not covered under the policy. Despite funding the health plan, he wasn’t insured under the policy.
Resolution: With no medical coverage in place, Aruj had to bear the full cost of his hefty treatment out of pocket. Following his recovery, he took the initiative to understand the policy better and enrolled in a medical insurance plan that matched his needs.
Key Takeaway:
- The premium payer isn't always the insured.
- Don’t just pay, make sure you’re officially part of the health plan.
- Stop guesswork and understand your policy thoroughly.
- Good intentions won’t cover the hospital bill; clarity will.
Don’t wait for a medical crisis to read the fine print of your health plan. Get insured and get peace of mind.
It’s Time to Lead Your Insurance Journey!
Being a policyholder means more than just health insurance. It means knowing what your health plan promises, keeping your details accurate, and stepping up when it counts. By staying on top of things, they are ready when life throws the unexpected. It wouldn’t be an exaggeration to say, behind every successful claim is a well-informed policyholder with one secret weapon: awareness.
>> Also Read: How to Download Care Health Insurance Policy?
Disclaimer: All plan features, benefits, coverage and claims underwriting are subject to policy terms and conditions. Kindly refer to the brochure, sales prospectus and policy documents carefully.
