URIE's are often confused with an incorporated mutual insurance company. Dennis Reinmuth compares URIE's to a limited liability company (LLC) and even a limited partnership (LP). Both the URIE and the LLC are made up of members. Members enter into a direct partnership with most of the features associated with a mutual agency. As is also true in the case of the LLC, there is no incorporated limited liability entity owned by shareholders. Share ownership and limited liability evidenced by stock certificates are issued to each owner in proportion to his ownership.
A members of an URIE may be either a natural person, a LLC or LP, a partnership, or a corporation. In some states, municipalities form URIEs to indemnification|cross-indemnify towns, cities, villages, and counties.
The AIF is a stakeholder and a trustee who holds the deposits made by each member. All property entrusted to the AIF in a URIE remains, at all times, the property of the subscribers. In that regard, the AIF is a classic trusteee, and the members are the beneficiaries of the trust.
References
- The Regulation of Reciprocal Insurance Exchanges, by Dennis F. Reinmuth (ISBN 0256006768)
- USAA. A Tradition of Service 1922 –1997, by Paul T. Ringenbach (ISBN 07-018280-9)
- USAA: life story of a business cooperative, by Edward Clare Dunn (ISBN 070182809).