Which of the following describes Reciprocal Insurers?

Reciprocal insurers are a unique type of insurance organization that operates on the principles of mutuality and cooperation among policyholders. They are typically unincorporated and non-profit, meaning they do not exist primarily to generate profit for shareholders but rather to serve the interests of their members. Each member, or subscriber, contributes to a pooled fund that is used to pay claims, and in return, they receive coverage. This means that the focus is on risk-sharing among members rather than profit-making, which aligns with the nature of reciprocal insurance.

The structure of reciprocal insurers also allows for a more direct participation from their members in the decision-making process and distribution of surplus, further emphasizing their cooperative nature over profit-driven motives. This characteristic distinctly sets them apart from incorporated insurance companies, which are designed to generate profit and often distribute profits to stockholders.