Mutual Holding Companies
The major disadvantage of the mutual insurance companies is the difficulty of raising capital. In response to this issue, the "mutual holding company" structure was first introduced in Iowa in 1995, and has spread since then. There have been some concerns that the mutual holding company conversion is disadvantageous for the actual owners of the company, the policyholders, and observers such as the Center for Insurance Research have advocated that companies should fully demutualize rather than taking this partial step.
In the 111th Congress, Carolyn Maloney sponsored a bill that she claimed would have protected mutual holding company owners. The measure, H.R. 3291, died in committee.
Mutual holding companies are one way to undergo demutualization.
Read more about this topic: Mutual Insurance
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