A policyholder is the individual or entity that owns an insurance policy. In personal injury law, the policyholder is often the person who holds an auto, homeowner’s, business liability, or health insurance policy that may come into play when a claim is filed. They are responsible for paying premiums and are entitled to the benefits outlined in their coverage agreement.
Role in a Personal Injury Case
The policyholder can be either the injured party or the person being held responsible for the injury. For example:
- If someone is injured in a car accident caused by another driver, the at-fault driver is typically the policyholder of the auto insurance policy that may provide coverage for the damages.
- If the injured person files a claim through their own insurance—such as under uninsured motorist coverage or medical payments coverage—they act as both the plaintiff and the policyholder.
In either case, the insurance company’s obligation is tied to the terms of the policy held by the policyholder.
Responsibilities of the Policyholder
- Paying Premiums: The policyholder must keep up with premium payments to ensure the policy remains active.
- Notifying the Insurer: The policyholder must usually report the incident promptly to the insurance company after an accident or injury.
- Cooperating in the Investigation: The insurer may require statements, documentation, or other information to evaluate the claim. Policyholders must cooperate fully for the claim to proceed.
- Understanding Coverage Limits: It is the policyholder’s responsibility to know what their policy covers—and what it doesn’t. This includes limits on liability, exclusions, and whether legal defense costs are included.
When the Policyholder is the Defendant
In many personal injury cases, the defendant is the policyholder whose insurance may be used to cover the plaintiff’s damages. The insurance company typically steps in to provide legal defense and, if necessary, negotiate a settlement or pay a court judgment—within the policy limits.
When the Policyholder is the Plaintiff
Sometimes, the policyholder is the injured party seeking coverage from their own insurance—for example, after a hit-and-run or when the at-fault party is uninsured. In such cases, the policyholder may file a first-party claim, seeking compensation under their own policy.
Interaction with Insurers
A policyholder’s relationship with their insurance company is based on the contract (policy) they agreed to. While the insurer must act in good faith, disputes can arise—particularly around coverage denials, settlement amounts, or payment delays. In some instances, a policyholder may take legal action against their own insurer for acting unfairly or unreasonably, known as a bad faith claim.
A policyholder plays a central role in personal injury cases, even when they’re not the one filing the lawsuit. Whether they’re the person injured or the one being sued, their insurance policy often determines how claims are handled, who pays for damages, and whether legal representation will be provided. Understanding the rights and responsibilities of a policyholder is essential to navigating personal injury claims effectively.
