In an insurance policy, what typically protects the interests of the policyholder?

The policyowner plays a crucial role in protecting the interests of the policyholder. They have the authority to make decisions regarding the insurance policy, including selecting coverage types, determining beneficiaries, and managing premium payments. This position allows the policyowner to ensure that their financial needs and preferences are accounted for in the policy.

In contrast, the insurer is the company providing the insurance coverage; their primary interest lies in managing risk and ensuring profitability. The beneficiary is an individual or entity designated to receive the benefits from the policy upon the occurrence of a covered event, but they do not have control over the policy itself. The trustee, when applicable, manages and administers the policy for the benefit of the policyholder or beneficiaries, but does not directly represent the interests of the policyholder as closely as the policyowner does. Thus, the policyowner's role is fundamentally about safeguarding the rights and intentions of the policyholder.