Term
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Definition
A company is owned by stockholders.
The stockholders elect directors and officers.
Shareholders receive taxable stock dividends (return of profit) |
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Term
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Definition
A company is owned by its policyholders.
The policyholders choosed a Board of Trustees or Directors to manage the company.
Profits are returned to policyholders as nontaxable dividends. |
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Term
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Definition
| The process where a mutual insurer becomes a stock company. |
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Term
| Fraternal Benefits Societies |
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Definition
are primarily social organizations that engage in charitable and benevolent activities thats provide insurance, primarily life insurance to its members.
They are usually organized on a nonprofit basis. |
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Term
| Reciprocal Insurance Company |
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Definition
| A group-owned insurer whose main activity is risk-sharing. They exchange insurance on one another. Each member is known as a subscriber. The exchange of insurance is affected through an Attorney-In-Fact. |
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Term
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Definition
| A group-owned insurer who assumes and spreads the liability risks of its members. They are in insurance company, licensed in at least one state the is owned by their policyholders, who are also their shareholders. |
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