Is Is Safe To Keep Life Insurance Policies With Aig Since They Asked For The Second Bailout?
Posted July 26, 2009 – 10:44 am in: structured settlements FAQIs AIGO paying claims or are they unable to pay claims. I’m assuming that they are still able to pay claims but is there a risk in keeping life insurance policies with them.
Tags: Asked, Insurance, Keep, Life, Policies, Safe, Second, Since, They, With
4 Comments
The life insurance companies are not really at risk if the corporation as a whole folds. The corporation is the entity that is going down, but most of their operations are still very sound on their own. That’s why they got the loans and that’s why they are selling off those solid pieces to pay back the loan. The insurance companies have separate reserves and assets that they are forced to set aside by the state insurance departments that are there to pay your claims.
Also as one of the other comments mentioned, if the insurance company did collapse your state would step in and another insurance company would gladly take your policy over. If the insurance company collapses the big losers will be the investors in the company stock and bonds not the policyholders.
You can be assured that your policy will be valid.
Even if AIG fails, your policy will be taken over by the state guaranty fund in the state where you live. This statement will not be valid for a face amount over $300,000 in most states.
You need to know that AIG owns numerous life insurance companies and that these companies need to be evaluated on their own financial merits. They are all subject to scrutiny of state insurance regulators.
The problems of the mother company – AIG – stem from their goof in insuring securities against loss on the assumption that they would never need to pay claims. Unfortunately, the housing collapse also trashed this assumption.
The life insurance company you have can easily be tracked through your state insurance authorities.
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