Mutual insurance

Mutual insurance society is one of the organizational forms of insurance company, which carries out paid insurance at the expense of its own funds, insuring the property interests of members of the society. That is, the members of the society are policyholders and co-owners of the insurance enterprise, the main task of which is to provide exclusively to its members the best quality insurance services at an acceptable price.

In the modern view, mutual insurance societies appeared at the end of the XVII century. The mutual insurance method was initially developed in the life insurance segment, because the mutuality method was easier to introduce in personal insurance rather than in property insurance. Since the XVIII century in Europe there appeared P&I clubs - special forms of shipowners' liability insurance on a mutual basis. Gradually the method of mutual insurance was developed in insurance of agricultural risks, fire insurance and in other spheres.

In the 1990s, most mutual insurance companies changed their legal form to joint stock companies in order to gain access to capital. However, some large mutual insurance companies have retained their legal form and continue to thrive.

Mutual insurance companies, to a large extent, operate in the life insurance industry. In the U.S., the two companies that are considered to be #1 and #2 major players in the life insurance industry have a mutual insurance form. Gross written premium of these companies for 2022 amounted 13.9 billion and 12.5 billion USD accordingly.