Is there a difference between a loss payee and a lien holder?

No, not really. Based on the following definitions taken from the CarInsurance.com web site you will see that the two terms are very similar. The loss payee and a lien holder may be separate entities or they may be both. To explain this let us look at each.

Loss Payee: A person or entity with a legally secured insurable interest in another's property, usually a financial institution that loaned money to buy a car. The car is the loan collateral. If the auto is damaged in an accident, loss payments will be made to you and to the loss payee on your policy.

Examples of a loss payee can be a co owner or co signer on a vehicle who has an insurable interest in the property, an individual with whom a financial agreement has been made securing the property as collateral such as a personal sale or a temporary personal loan. A loss payee can also be a financial institution like a bank or finance company who loaned the funds for the purchase.

[Let CarInsurance.com help you find affordable auto insurance now.]

Lien holder: A person or organization with a financial interest in property up to the amount of money borrowed or still owed on the property.

Examples of a lien holder would be a bank, finance company, credit union or other party to whom funds are owed as payment for the property

The difference is such, the loss payee does not have to own the property they simply have an insurable interest in it. A lien holder owns the property until payment for the property has been made in total. For this reason, a lien holder may also be considered a loss payee. If there is a loss payee, a lienholder, or an insurable interest on your vehicle please be sure to list them on your insurance.

With CarInsurance.com, you simple list them on the vehicle page when you are purchasing a policy.