Phillips, 39, has now scored five goals in seven appearances since his loan move from Blackpool and his treble killed off the challenge of promotion rivals Hull, who drop to third.
Tigers manager Steve Bruce was incensed by the penalty decision that allowed Phillips to put the hosts ahead on the stroke of half-time, but there was no controversy about his second-half brace that put Palace firmly in control.
"The bloke is so professional and is still as fit as a flea. He's got the lungs of a 26-year-old," Holloway said of Phillips. "I'm just delighted he understands how I want to use him here. I knew that with the wide players we have here he would be the ideal man to get on the end of things.
"Now it's all about keeping the energy of the squad and bringing things together. We have beaten a very, very good team and we know it will be tough between now and the end of the season. You just have to keep trying to win every game because if you lose a game at this stage, it is hard to get over the disappointment."
Palace's Glenn Murray had already seen a 30th-minute penalty saved by David Stockdale before the hosts went ahead from a second spot-kick awarded when referee Mark Haywood harshly ruled Jack Hobbs had handled in the area.
Phillips tucked home the penalty to open the scoring, then added further goals in the 52nd and 53rd minutes, with both chances teed up by Wilfried Zaha.
Hull substitute Jay Simpson gave the visitors hope with a 72nd-minute header but Zaha's 77th-minute strike settled the outcome before David Meyler headed Hull's second in added time.
Bruce said: "I've no complaints with the result but that may be the worst penalty I have ever seen. It was a shocking, shocking decision. Referees make the decisions but we have to live with them. Kevin Phillips has always haunted me over the years and even at this age he is still doing it.
"Then his second was a mis-hit and the third got a deflection so we knew it wasn't going to be our night. But there are going to be a lot more twists and turns yet. Referees make decisions but we have to live with them. But we have just got to get on with things."
- Sports & Recreation