Which term describes an insurance company owned by its shareholders?

A stock insurance company is defined as an insurance entity owned by shareholders who invest in the company and receive profit through dividends. This structure allows shareholders to have influence over corporate governance, including the election of the board of directors and other key decisions impacting the company’s operations.

In the context of the other terms, a mutual insurance company is owned by policyholders, who are entitled to dividends based on the company’s surplus, rather than shareholders. Participating insurance companies also distribute profits among policyholders in the form of dividends, reinforcing the idea of ownership by those not investing as shareholders. Cooperative insurance companies focus on serving the needs of their members, emphasizing member participation and benefit rather than shareholder profit. Each of these other entities operates under distinct ownership frameworks that do not involve shareholders in the same way a stock insurance company does.