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Let’s face it, car insurance jargon can be a bit of a head-scratcher. From your excess, to your premium, to comprehensive cover…it’s enough to make your head spin.

But one term you definitely don’t want to gloss over is “car insurance policyholder.” Why? Well, because if you’re the policyholder on your car insurance policy, that means you’re the one responsible for making sure everything is accurate and up to date. 

You’ll have specific roles and responsibilities regardless of whether you’ve opted for a temporary car insurance policy or an annual car insurance policy. So let’s dive in and explore what being a policyholder really means for you and your car insurance. 

Person in orange with blue car and trees and sun in the background.

What is a car insurance policyholder?

Whether you’re insuring your leased vehicle or a car you just bought, you’re going to be the car insurance policyholder. Simply put, the car insurance policyholder is the person who takes out the car insurance policy. But that comes with a whole host of responsibilities. 

As the policyholder, you’ll hold the keys (pun intended) to the car insurance policy. If you’re the policyholder, you can do things like add other drivers to your policy, make changes to your policy, and negotiate your renewal rates. 

But, you also need to make sure you’re keeping your policy up to date. That means informing your insurer when you move house, when you get a new job, or when there are any changes to your circumstances that could affect your car insurance premium. It’s easy to forget this basic bit of life admin in the midst of moving house, for instance, but it’s one of your responsibilities as the policyholder. You don’t want to be caught out with incorrect information if you need to make a claim.

Speaking of claims, that’s another thing you need to be prepared for as the policyholder. If you’re involved in an accident or your car gets stolen, it’s up to you to get the ball rolling with the insurance company. That means contacting them ASAP and providing all the necessary information so they can process your claim.

So basically, as the policyholder, you get all the “joy” that comes with keeping your contractual obligations with your insurer. That’s adulting for you. 

What’s the difference between policyholders vs named drivers?

A named driver is simply someone who is added to a policyholder’s insurance policy as an additional driver. The named driver is given the same level of cover as the policyholder, but they are not the owner of the policy.

Usually, named drivers are added to a policy if they share the same vehicle with the policyholder or if they occasionally drive the insured vehicle.

So what’s the difference between the two, you may ask? Well, the main difference is that policyholders have a greater level of control and responsibility over the insurance policy. They “get” to make all necessary changes to the policy, add any drivers, and pay the premiums.

The named drivers simply get to drive the car while benefiting from the cover arranged by the policyholder. There are more details about the key differences between named drivers and policyholders here.

Man with blue hatchback car with trees and the sun in the background

Can you have more than one policyholder on a single policy?

Let’s get this out of the way first – there’s only one principal policyholder per policy. So no, you can’t have more than one policyholder on a single policy. This means that if you and your BFF want to share a policy, one of you will have to take the lead and be responsible for the contract. Don’t worry, though, you can still add your friend as a named driver on the policy.

But what if you and your partner want to co-own a car and share the insurance? Your best bet might be to take out a regular car insurance policy and add the one who drives the car the least as a named driver. 

Now, let’s talk about named drivers. As we mentioned before, you can add other people as named drivers to a policy (as long as they meet the eligibility criteria). This means they’ll have the same level of cover as the main driver. 

One thing to note is that the main driver (also known as the nominated driver) should typically  be the person who drives the car most often. This is the person who will normally earn the no claims discount (NCD) as well. 

Do I need to be the policyholder to be the main driver? 

So do you need to be the policyholder to be the main driver? Here’s the short answer: not necessarily! 

Let’s break it down. The policyholder is simply the person who has taken out the car insurance policy. This person might be the registered keeper and owner of the car but they might just be using the car occasionally. 

The main driver, on the other hand, is the person who drives the car the most. This might be the policyholder, but it might also be their partner, for instance. If the policyholder only needs to drive the car once a week, but their partner drives to work everyday, then they’re the main driver because they use the car more frequently. 

So, why does it matter who the main driver is? Well, for one thing, car insurance providers base their premiums off various factors, including who drives the car the most. The main driver’s age, driving experience, and claims history can all impact the cost of the policy.

To make sure you’re giving your insurer accurate information, you need to let them know who drives the car the most. The person who drives the car the most becomes the main driver. 

Car insurance policyholders: An overview 

Now that we’ve cleared up all the confusion between being a policyholder, a main driver, or a named driver, you can hop in your car with a lot more confidence about your car insurance. As the policyholder, you can do all sorts of things, like initiate claims, make changes to your policy, and add drivers. 

But, in the words of Uncle Ben from Spiderman,  with great power comes great responsibility. Understanding what this responsibility entails is essential to keeping your policy up to date and valid.