Types of insurers

Question 1

Stock Insurer

Answer 1

Issued by a private corporate company

Owned by stockholders

Dividends are paid in return of profit

Corporate dividends are taxable

Non participating policies to policy holders

Question 2

Mutual insurance

Answer 2

Owned by policyholders

Policy dividends are returned to policy holders as a return of excess premium ( not guaranteed and are not taxable)

Participating policies

Question 3

Reciprocal insurers

Answer 3

unincorporated owned by a group of people for the main purpose of risk sharing

Members are known as subscriber

Exchange is run through an attorney- in- fact

Assessments of additional premium can be made

Question 4

Lloyds of london

Answer 4

Group of syndicates who share in high risk of losses

Not an insurance company***

Provides a meeting place for syndicate members to transact business

Members are liable for each risk they assume

Question 5

Faternal benefit society

Answer 5

Social organizations

provides life insurance and annuities to members

Non-profit organization based on a lodge or fraternal system

only offers insurance to members of the organization