Explanation of State Insurance Guaranty Associations
According the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA):
“What is a life & health insurance guaranty association?
Life & health insurance guaranty associations were created to protect state residents who are policyholders and beneficiaries of policies issued by a life or health insurance company that has gone out of business. All 50 states, the District of Columbia, and Puerto Rico have life and health insurance guaranty associations.
All insurance companies (with limited exceptions) licensed to write life and health insurance or annuities in a state are required to be members of the state’s life and health insurance guaranty association. If a member company becomes insolvent (goes out of business), the state guaranty association obtains money to continue coverage and pay claims from member insurance companies writing the same line or lines of insurance as the insolvent company.”
To learn more about state guaranty associations, go to http://www.nolhga.com/home.cfm
To view coverage limits for each state, go to http://www.nolhga.com/policyholderinfo/main.cfm/location/ga