JOHNSTON, R.I.—Factory Mutual Insurance Co., which does business as FM Global, said Tuesday that clients will be eligible for the largest “membership credit” it has ever paid—about $420 million in total—for renewing their policies between June 30 this year and June 29 next year.

In a statement, the Johnston, R.I.-based insurer said the record membership credit “is a result of the mutual insurer’s continued financial success due, in large part, to policyholders’ diligent loss prevention efforts. The credit each client will receive will be based on client tenure, with longer-term clients benefiting the most.”

In recognition of its 175th anniversary, clients who have been with FM Global 35 years or longer will be eligible for a membership credit of 20%.

“More than 250 clients qualify, some of which have been policyholders with FM Global since the late 1800s,” the insurer said in the statement.

“Following this credit, the company will have applied nearly $1.7 billion in total membership credit to its policyholders since 2001,” Shivan S. Subramaniam, FM Global’s chairman and CEO, said in the statement.

Clients holding policies consecutively for fewer than five years will be eligible for a 5% credit; those with policies continuously for five to 19 years will be eligible for a 10% credit; and those with policies for 20 to 34 years will be eligible for a 15% credit.

“As a mutual insurance company founded in 1835 on the belief that the majority of loss is preventable, FM Global’s membership credit is a unique client benefit because our policyholders are committed to this principle and share in the benefits of their risk improvement efforts,” Mr. Subramaniam said.