established mutual, sufficient funds and expertise will have been accumulated to make advance calls that will generally be sufficient to cater for all losses in that financial year. These mutual are usually non-profit making, without share capital, and are used by insurers of a particular class, with or without the involvement of the trade or professional body concerned9.
An example of this kind of mutual is the Protection and Indemnity Club'10. This largely owes its origin to the reluctance of London underwriters to associate themselves with the liability risks that emerged in shipping around the turn of the 19th century. The clubs, as they became known", also provided advice and services. Some have become involved in physical damage insurance to the hulls, others in war and strike risks. More recently, they have been used to solve professional liability problems.
5.5
Other Registered Societies and Clubs
Called 'fraternal' in the US, these organisations provide mutual aid and self-help12. Examples are:
(I) Friendly societies, which began over 200 years ago, performing functions largely taken over by the welfare state, but which still provide for those areas where the services of the state or other agencies are either non-existent, inadequate or need supplementing. In addition to relief or maintenance during sickness, unemployment (and retirement and life assurance), friendly societies are able to provide other insurance that is of a more personal nature.
(ii) Non-profit making organisationsproviding private health care and hospitalisation. (iii) The insurance co-operative which is most frequently used for agricultural insurance. (iv) Finally
in Third World
countries, there are the 'reciprocals'.
Reciprocal
exchanges operate in the areas of property damage and liability protection. They are unincorporated associations of the insured; each insured person, in effect, being a part owner of the enterprise and assuming a definitely established underwriting liability, which is shared. Reciprocal exchanges have also been used in the US as a way of
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