The Benefits of Owning a Whole Life Policy from a Mutual Life Insurance Company

Whole life insurance is available from two types of life insurance companies: stock and mutual. Your experience as a policyholder will vary depending on which type of company you select.

1. In a stock company: The policyholder ( you ) is simply a customer, entitled to the benefits described in the policy. The stock company is owned by its shareholders, who participate in any profits the company earns. The policyholders in a stock company may not share in performance or profits through declared dividends on their whole life policies.
2. In a mutual company: The policyholders are the company's owners, and they share in its operating performance and profits. When you own a whole life policy issued by a mutual company, you are immediately entitled to an annually-declared dividend. While the payment of dividends is not contractually guaranteed, strong mutual insurance companies have a long track record of providing this added benefit to their policyholders. The Guardian Life Insurance Company of America is one such example.

If you choose to own a policy issued by a mutual company, you can check the companies' historic record of paying dividends. This record indicates the company's ability to operate profitably over time, and also the importance that the company places on paying dividends to its policyholders. This very important distinction should not be overlooked when you decide about what insurance company to purchase your whole life policy from.