Unit 3 - Insurance Exam

Stock company

the company is in the business of selling insurance to the insured; profits attributed to the operation of the company are returned as dividends to the stockholders, not the insureds

Mutual company

the insureds are also owners of the company; they can vote to elect the management of the company; profits are returned to the insureds in the form of dividends or reductions in future premiums

Assessment company

companies that provide fiire and windstorm insurance to small towns and farmers

Reciprocal company

agrees to share insurance responsibilities with all other members of the unincorporated group; share the losses with each other

Lloyd's Association

a voluntary association of individuals or groups who agree to share in insurance contracts; each individual or group is individually responsible for the amounts of insurance they write

Fraternal benefit society

an incorporated society or order that is operated on the lodge system and conducted solely for the benefit of its members and their meneficiaries and not for profit; life and health insurance