What defines a mutual insurer?

A mutual insurer is defined as an entity that is owned by its members who hold insurance policies. This structure allows policyholders to have a say in the operations and management of the company, as they are essentially the owners. Unlike stock insurers, which are owned by shareholders and operate with the goal of profit generation, mutual insurers focus on serving the interests of their policyholder members. The premiums collected are typically used to provide insurance coverage and services to members rather than being distributed as profits. This member-centric organization often results in a strong alignment between the insurer's operations and the needs of the policyholders, fostering trust and loyalty within the community that the insurer serves.

The other choices highlight characteristics of different types of insurance organizations or misrepresent the nature of mutual insurers. For instance, being nonprofit is not inherently true for all mutual insurers, as they can still operate with financial goals focusing on member benefits rather than shareholder profits. The reference to operating solely online is also not a defining characteristic, as mutual insurers can have traditional brick-and-mortar offices as well. Thus, the option that describes mutual insurers accurately is the one highlighting ownership by the policyholders.