A stock insurance company is owned by stockholders and is operated to earn a profit. A mutual insurance company is collectively owned by its policyholders and is thus a cooperative. Both stock and mutual insurance companies must maintain cash reserves to cover future obligations and policyholders' claims. As Table 21.1 shows, four of the five largest life insurance firms are mutual companies. Careers in Insurance .
Insurance companies form one of the largest industries in the United States.
Careers in insurance generally fall into two categories. In the sales category, individuals can work as employees for insurance companies or as independent agents. Administrative employees work to meet the needs of the firm's customers. A part of effective risk management is to ensure that, when insurance is purchased, the coverage is proper for the individual situation. Three questions can be used as guidelines in this regard.