What type of insurance company typically does not participate in dividends for policyholders?

A stock insurance company typically does not participate in dividends for policyholders because stock insurance companies are owned by shareholders. These shareholders provide the capital necessary to operate the company and are entitled to any profits the company generates in the form of dividends. The policyholders in a stock company are not the owners; therefore, they do not receive dividends based on the company's profits. Instead, they may benefit from lower premiums or improved services.

In contrast, mutual insurance companies are owned by policyholders, and they often distribute dividends to them based on the insurer's overall profitability. Fraternal benefit societies operate similarly, providing benefits to their members, and often include provisions for dividends as well. Reciprocal exchanges are another model where policyholders share in the risks and profits, often resulting in dividend distribution. Hence, stock companies stand out because their primary obligation is to their shareholders rather than the policyholders, leading to the absence of dividends for the latter.