What Is a Life Insurance Guaranty Fund?

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Life insurance guaranty funds are set up on a state-by-state basis. Find out about life insurance guaranty funds with help from a member of the California Department of Insurance Curriculum Board and insurance professional in this free video clip.

Part of the Video Series: Life Insurance & More
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Video Transcript

Hi, I'm Tony Steuer, the Life Insurance Sage, and this is my tip on the life insurance guaranty funds. Life insurance guaranty funds are set up on a state-by-state basis. each state also provides a different benefit schedule in terms of how much coverage they provide. So, while one state may provide up to a 300,000 dollar death benefit in the event of a company going insolvent, another state may offset up to 500,000 dollars worth of insurance. However, they may only provide coverage of 80 percent up to that maximum. So, the benefit schedule is going to vary significantly from state to state. There's links to the National Association of Life and Heath Insurance Guaranty Funds on my website at LifeInsuranceSage.com. That website in turn will take you to each state's specific life insurance guaranty fund, where you can see what benefits are provided to you by that state. The basic premise of the life and health insurance guaranty funds are to provide coverage in the event that your insurance company were to go insolvent. I'm Tony Steuer, the Life Insurance Sage, and that was my tip on life insurance guaranty funds. Thank you for watching.

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