Who manages a reciprocal insurance company?

A reciprocal insurance company is managed by an attorney-in-fact, who acts on behalf of the policyholders (also known as subscribers) to provide the necessary management and oversight of the company's operations. In a reciprocal insurance arrangement, the policyholders pool their resources to provide insurance to one another. This unique structure means that the attorney-in-fact plays a crucial role in making decisions, handling claims, and ensuring that the company's business is conducted efficiently.

The attorney-in-fact is appointed by the policyholders and has the authority to represent the interests of the subscribers in all matters concerning the company. This arrangement allows for a more cohesive management structure tailored to the specific needs of the policyholders, distinguishing it from other types of insurance companies where a board of directors or independent contractors may typically hold managerial roles.

Understanding this structure is essential, as it highlights the collaborative nature of reciprocal insurance and the centralized responsibility placed on the attorney-in-fact to act in the best interests of all participating policyholders.