Who is the policy owner in an insurance contract?

The policy owner in an insurance contract is the individual or entity that possesses the rights and privileges associated with the policy. This includes the authority to make changes to the policy, such as updating beneficiaries, adjusting coverage amounts, or cancelling the policy. Because the policy owner controls these aspects, they have significant influence over how the policy functions and what benefits it provides.

In contrast, the person covered by the policy may benefit from the insurance but does not necessarily hold any control over the policy itself. While the individual responsible for paying the premium is often the policy owner, this is not always the case; a third party can pay premiums for someone else's policy. The designated beneficiary is the individual who will receive the policy’s death benefit upon the insured's passing, but they do not have control over the policy itself. Thus, the correct understanding of the policy owner's role highlights their control over the rights associated with the insurance contract.