In the face of large liability exposures, businesses and those who are associated with them should make every effort to avoid losses or to mitigate such losses if they occur. There are a myriad of ways to do so, including education and training of employees, indemnification agreements, as well as auditing of safety procedures. Obviously, one of the best ways to mitigate the kind of losses mentioned above is to transfer them to an insurer through the purchase of business-liability insurance. In this way, they are like shareholders in other corporations. Mutual insurance companies are not, however, operated for profit.
Unused money earned by the corporation is returned to the policyholders as dividends.
Stock insurers are usually public companies whose stock is traded on a stock exchange. Like other commercial corporations, a stock insurer will have a board of directors as well as officers and employees. Lloyd's of London is famous as an insurer of unusual risks. Today, corporations may also become Names at Lloyd's. At Lloyd's, the Names are organized into syndicates who operate through an appointed individual called the underwriter.