What is the main function of the members within a Reciprocal Insurer?

The primary function of members within a Reciprocal Insurer is to collectively pay any member's covered loss. Reciprocal insurers operate on a mutual basis, where the policyholders, who are also members, pool their resources to provide coverage for one another. By participating in this arrangement, each member contributes premiums to a common fund that is specifically set up to address the losses incurred by any member. This collective sharing of risk is a key characteristic of reciprocal insurance, fostering collaboration among members to ensure that claims are met.

Given this structure, the focus is on member support rather than competition or profit generation typical of traditional stock companies. The idea is that all members are both insured and insurers, sharing in the responsibility for losses, which aligns with the fundamental principle of mutual aid.