Which type of insurance company is owned by shareholders?

The correct choice identifies stock companies as insurance companies owned by shareholders. In this structure, the ownership is divided among individuals or entities that hold shares of the company's stock. Shareholders invest capital in the company with the expectation of earning a return on their investment through profits, which can be distributed as dividends.

Stock companies operate with the goal of generating profits for their shareholders, and this profit motive can influence their operational decisions and product offerings. Additionally, because they are publicly traded, stock companies have greater access to capital markets, allowing them to potentially offer a wider range of products and services to their customers.

Mutual companies, on the other hand, are owned by policyholders rather than shareholders, meaning that the customers have a vested interest in the company’s success beyond just the products they purchase. Non-profit organizations do not operate for profit and therefore do not have shareholders in the same way that stock companies do. Independent brokers act as intermediaries between clients and insurance companies but are not insurance companies themselves and do not have ownership stakes in such companies.

Thus, stock companies represent the model of an insurance organization where ownership and financial interest lie with shareholders.