A California-domiciled property insurer is organized so that the insureds collectively own the company, are entitled to dividends from underwriting profits, and may be subject to assessments if losses exceed surplus. Under the California Insurance Code, this organizational form is best described as:

Why this is the answer

Ins. Code § 4010 defines a mutual insurer as an insurance corporation without capital stock, governed by a board elected by its members (the policyholders). Members are entitled to participate in surplus through dividends and, in the case of an assessable mutual, may be assessed if losses exceed surplus. A stock insurer (Ins. Code § 4010) has shareholders separate from policyholders. A reciprocal or interinsurance exchange (Ins. Code § 1280) is an unincorporated association operating through an attorney-in-fact. A fraternal benefit society writes life/disability for members of a fraternal order (Ins. Code § 10990). See Ins. Code § 4010.