Types Of Insurance Companies

There are a few types of insurance companies. To make sure that you are informed about them, we have created this simple guide below.

Standard Insurance Companies

These will insure drivers who have an average risk rating. So, these companies will only insure a driver who has a clean driving record with few claims.

Substandard Insurance Companies

These will insure drivers whose risk factors make it hard to be insured by standard companies. For instance, you may need a substandard company to insure you if you:

  • have a salvage or rebuilt title
  • are a teen driver
  • are a high risk driver
  • need an SR-22
  • need a non-owner insurance policy


Policyholders “own” mutual insurance companies. Therefore, they can purchase insurance services from the company and become part “owners.” Policyholders cannot sell their stake in the company to another person, however. Insurance companies may share profits with policyholders in the form of payments. Or, the insurance company may instead keep the profits in exchange for discounts on future premiums.


Stock insurance companies are privately held companies or publicly traded corporations. Stockholders, as well as other stock companies or mutual companies, own these stocks. Stock companies have a specific goal, which is to make a profit for its stockholders. However, the profits or losses of the company won’t impact policyholders.

More Information

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