Who owns a mutual insurance company?

A mutual insurance company is owned by its policyholders. This means that the individuals or entities who have purchased insurance policies from the company are also members and have a stake in its operations and profits. In contrast to stock insurance companies, which are owned by shareholders who may or may not be policyholders, mutual insurance companies do not have outside shareholders. Instead, they operate on the principle that policyholders collectively own the company, allowing them to share in its dividends and any potential surplus generated from its operations.

This ownership structure often leads to a focus on the interests of the policyholders, since any profits are typically returned to them rather than distributed to external investors. Consequently, policyholders in a mutual insurance company may also have the right to vote on important company matters, reinforcing their ownership status and influence over the company's direction and governance.

Other options, such as private shareholders or the federal government, do not accurately represent the ownership structure of mutual insurance companies. A board of directors is responsible for managing the company, but they serve the interests of the policyholders rather than owning the company themselves.