In which type of insurance company do policyholders potentially receive dividends?

Policyholders potentially receive dividends in mutual companies because these companies are owned by the policyholders themselves. When a mutual company generates a profit, it can distribute a portion of those profits back to the policyholders in the form of dividends. This profit distribution aligns with the mutual ownership structure, where the interests of the policyholders directly influence the company's financial decisions.

In contrast, stock companies are owned by shareholders who invest in the company with the expectation of profit, and any dividends are distributed to shareholders rather than policyholders. Lloyd's companies operate on a different model that involves syndicates underwriting risks, and they do not typically offer dividends to policyholders. Self-insured companies manage their own risks and do not involve traditional insurance mechanisms that would facilitate dividend distribution to policyholders.