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A mutual insurance company and a stock insurance company have one main difference - what is it? a) Ownership structure

b) Premium rates
c) Policy coverage
d) Geographic focus

User Asolace
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1 Answer

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Final answer:

The main difference between a mutual insurance company and a stock insurance company is their ownership structure.

Step-by-step explanation:

The main difference between a mutual insurance company and a stock insurance company is their ownership structure. A mutual insurance company is owned by its policyholders, who are also its customers. Policyholders have voting rights and may receive dividends. The profits of a mutual insurance company are returned to the policyholders in the form of reduced premiums or policyholder dividends. On the other hand, a stock insurance company is owned by shareholders, who may or may not be policyholders. Shareholders elect a board of directors and receive dividends based on the company's profits. The profits of a stock insurance company are distributed to the shareholders.

User Amit Chaurasia
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