National Association of Mutual Insurance Companies

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Business Judgment & Payment of Dividends

Since the mid-1990s, multiple law suits have been filed seeking payment of dividends from mutual insurance companies to millions of class action plaintiff-policyholders. The cases that follow involved long-term litigation and multiple appeals. Ultimately, the insurance companies involved in these suits prevailed and the attempts to compel boards of directors to declare dividends, contrary to their business judgment and discretion, were unsuccessful.


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