If you’re building an insurance form, the term "nominee" often confuses the customer. More importantly, it has to be clear to the form builder because they decide who their nominee will be. This quick guide will walk you through who is a nominee in insurance and the related terms. We’ll cover the applicant and appointee and how to ask for a nominee in different insurance forms.

Who Is a Nominee in Insurance?

In an insurance policy, the nominee is chosen to receive policy benefits if the policyholder, the customer, dies. They act as legal custodians of these benefits, ensuring the designated recipient gets the needed financial aid.

This differs from a co-applicant who shares policy ownership and premium responsibilities. A nominee bears no financial obligation during the policy term, while a co-applicant does. In short, a nominee in insurance only serves as a beneficiary upon the policyholder's demise.

Nominee vs Co-applicant vs Appointee

The significance of a nominee in insurance specification lies in its ability to avert legal disputes about beneficiary rights. A nominee can facilitate the quick dispersal of benefits to the chosen recipient because the insurance providers know who to give away the compensation to.

Unlike co-applicants, nominees do not influence premium calculations or share the financial onus during the policy duration. Their main function is to represent the named recipient in the unfortunate event of the policyholder's death.

Something often confused among nominees and co-applicants is an appointee. An appointee is a person the policyholder appoints on behalf of a minor nominee to receive money from the insurance company. Simply put, if the nominee is a minor, the policyholder appoints a person (appointee) to receive the death benefits from the insurance company because the minor cannot claim the money directly.

Nominee Details Vary for Each Insurance Form

Now that we have listed the key definitions let’s examine a nominee’s role in different types of insurance forms.

• Life Insurance Form: As per life insurance nominee rules, here you need precise and detailed information about the nominee, including name, date of birth, and relationship to the policyholder. You might also accommodate alternative nominees for cases where the primary nominee passes away before the policyholder. The proportion to give away to different nominees can also be preset.

• Health Insurance Form: Health insurance forms allow nominating a beneficiary to claim unused accumulated benefits upon the policyholder's death. So, the data is limited to basic information like name and relationship with the policyholder.

• Property Insurance Form: Some high-value asset insurance policies like art or jewelry might allow beneficiary designation. Here, the details requested are again limited to name, relationship, and approximate age estimate. In the non-insurance scenario, there might be a “legal heir” as per a will, who shall receive the property after the owner passes away, but the role of the nominee stays the same.

• Critical Illness Insurance Form: Nomination in these forms is essential due to the financial support for critical illness diagnoses. Requesting the nominee's full name, date of birth, relationship to the policyholder, alternative nominees, and payout preference (lump sum or installments) makes sense.

• Travel Insurance Form: Plans that offer accidental death coverage allow beneficiary designation with information mostly about the name and relationship to the policyholder.

• Business Insurance Form: In a business insurance form, key person coverage or shareholder protection benefits require nominee information. Collect details like name, relationship to the policyholder or business, and their specific role within the enterprise.

4 Tips for Better UX in an Insurance Application Form

• Clarity: Define the nominee's role and the importance of accurate information using clear and concise language at the beginning of the form.

• Flexibility: Provide space for alternative or additional nominees and options for changing nominee details in case the user wants to do so.

• User-Friendly Design: Your nominee section should be easily locatable and understandable within the overall form structure. Having a progress bar is a must.

• Verify Compliance: Ensure the nominee section complies with relevant insurance regulations and legal requirements such as HIPAA in the health insurance form and SOC 2 otherwise.

  

Quick Summary and Next Steps

Understanding the role of a nominee in insurance and focusing on the best practices for making an insurance form can upgrade the user's form-filling process. Remember that clarity, accuracy, and a user-friendly design ensure faster navigation through an insurance form.

You can get started with WorkHack forms, which offer higher conversion rates than other forms. Make your first insurance form today.