What type of insurance company allows policy owners to elect a governing body?

A mutual insurance company is one that is owned by its policyholders. In this structure, policy owners have the ability to elect a governing body, typically a board of directors, which represents their interests. The governing body is responsible for making decisions regarding the company’s operations, policies, and dividends. This democratic element allows policyholders not only to participate in the governance of the company but also may provide them with additional rights and benefits as they are considered part of the ownership structure.

In contrast, a stock insurance company is owned by shareholders who may or may not be policyholders, and the governance is typically determined by the shareholders rather than the policyholders. Fraternal insurance companies are non-profit entities that provide insurance to members of a specific group, and while they do have a governing body, they operate under a different structure focused on social or community benefits rather than direct policyholder governance. Reciprocal insurance exchanges involve a group of subscribers who agree to insure one another, and while they do have some elements of participation, the governance is not solely in the hands of policyholders in the same way it is with mutual companies.