Which of the following statements about stock insurers is true?
A)They issue assessable policies.
B)They are not permitted to write property and liability insurance.
C)Stockholders bear any losses and share in any profits.
D)They are owned by their policyholders.

Question

Quizplus · Accepted Answer

Stock insurers are owned by shareholders who provide funding for the company. As a result, shareholders bear any losses and share in any profits that the company generates. This is in contrast to mutual insurers, which are owned by policyholders and have any profits returned to policyholders in the form of dividend payments or decreased premiums. Stock insurers are also permitted to write property and liability insurance, as well as other types of insurance. Finally, stock insurers do not issue assessable policies, which are a feature of some mutual insurers that allow the insurer to levy additional assessments on policyholders in the event of a significant loss or other financial difficulty.

Which of the Following Statements About Stock Insurers Is True