@ERI
Rights of parties to an insurance contract
by
October 2026
Confusion might arise in some cases, when the life insured, premium payer or beneficiary instructs the Client Operations team to cancel the policy or demands policy information or in a general deal with the policy.
This is why it is important to understand who the various parties are and their rights and obligations.
Understanding the policy holder
A policyholder is a person who is in the contractual relationship with the insurer and who acquires rights and obligations in respect of the policy contract. The policyholder can be an individual, a company, trust or a collection of individuals. This is the party that has the right to lodge a claim, amend the policy, ask for policy information or in a general deal with the policy.
Understanding life insured
The life insured is the object of the insurance. You can think of it in the same way as your motor vehicle is the object of a short-term insurance contract. The life insured in his or her capacity as such, has no rights to deal with the policy. This means that the life insured ,for instance, cannot demand policy information or make amendments or issue instructions for its cancellation.
The rights of the premium payer
As with a life assured, the premium payer does not have any rights under the policy. It sometimes happens that we get an instruction from the premium payer to cancel a policy, we cannot go ahead with this instruction. The premium payer can only cancel the debit order authority or stop paying premiums under the policy. If this happens, we will then notify the policyholder of the instruction.
Unpacking the rights of a nominated beneficiary
A beneficiary only has rights under the policy upon the death of the life insured. Before then, the beneficiary cannot deal with the policy. Prior to the death of the life insured a policyholder can change the beneficiary at any time.
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