Paul Sanchez
The Life and Health Insurance Company Guaranty Corporation of New York (the New York Guaranty Corporation) was created by the New York Legislature in 1985 to protect New York state residents who are policyholders and beneficiaries of policies issued by an impaired or insolvent life and health insurance company, up to specified limits. The Life and Health Insurance Guaranty Corporation (LHIGC) was also created by the Maryland General Assembly in 1980 to protect Maryland residents who are policyholders and beneficiaries of policies issued by an insolvent insurance company, up to specified limits.
| Characteristics | Values |
|---|---|
| Name | The Life and Health Insurance Company Guaranty Corporation of New York |
| Year established | 1985 |
| Purpose | To protect New York state residents who are policyholders and beneficiaries of policies issued by an impaired or insolvent life and health insurance company, up to specified limits |
| Membership | All life and health insurance companies licensed in New York to write life and health insurance are required to be members |
| Funding | In the event of a member company becoming impaired or insolvent, money to continue coverage and pay claims is obtained through assessments of the guaranty corporation's other member insurance companies |
| Coverage | Individual and group life insurance policies, health insurance policies, annuities, and funding agreements issued by life and health insurance companies licensed to do business in New York State |
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What You'll Learn
The Life and Health Insurance Company Guaranty Corporation of New York
In the event that a member insurer is found to be insolvent and is ordered to be liquidated by a court, the guaranty corporation provides protection to New York residents who are holders of life and health insurance policies, annuity contracts and funding agreements with the insolvent life insurance company. The guaranty corporation always covered health insurance policies issued by life insurance companies but in 2023 the law was changed to expand coverage to health insurance issued by health insurers including long-term care within the statutory limits.
The Life and Health Insurance Guaranty Corporation ("LHIGC") was created by the Maryland General Assembly in 1980 to protect Maryland residents who are policyholders and beneficiaries of policies issued by an insolvent insurance company, up to specified limits. Coverage is determined by Maryland law and policy language at the time the Guaranty Corporation is activated to provide protection.
In 1941, New York became the first state in the nation to establish a guaranty fund to protect policyholders of life insurance companies in the event of an insurance company insolvency. The guaranty corporation is a statutory not-for-profit corporation whose members consist of all life and health insurance companies licensed to do business in the state of New York.
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The Guaranty Fund
The Life and Health Insurance Company Guaranty Corporation of New York, also known as the New York Guaranty Corporation, was created by the New York Legislature in 1985 to protect New York state residents who are policyholders and beneficiaries of policies issued by an impaired or insolvent life and health insurance company, up to specified limits. All life and health insurance companies licensed in New York to write life and health insurance are required, as a condition of doing business in the state, to be members of the guaranty corporation.
In the event that a member insurer is found to be insolvent and is ordered to be liquidated by a court, the guaranty corporation provides protection to New York residents who are holders of life and health insurance policies, annuity contracts, and funding agreements with the insolvent life insurance company. Money to continue coverage and pay claims is obtained through assessments of the guaranty corporation's other member insurance companies.
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The Maryland Life & Health Insurance Guaranty Corporation
The LHIGC is a statutory not-for-profit corporation, similar to the Life and Health Insurance Company Guaranty Corporation of New York (the New York Guaranty Corporation), which was created by the New York Legislature in 1985. The New York Guaranty Corporation was the first of its kind in the nation, having been established in 1941.
The New York Guaranty Corporation protects New York residents who are holders of life and health insurance policies, annuity contracts and funding agreements with an insolvent life insurance company. All life and health insurance companies licensed in New York to write life and health insurance are required, as a condition of doing business in the state, to be members of the guaranty corporation.
The Maryland LHIGC is activated to provide protection when a member insurer is found to be insolvent and ordered liquidated by a court. Coverage is determined by Maryland law and policy language at the time of activation. The LHIGC cannot make statements regarding coverage of a specific policy unless it is a policy with a company for which the Corporation has been activated to provide protection.
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The New York Guaranty Corporation's other member insurance companies
The Life and Health Insurance Company Guaranty Corporation of New York (the New York Guaranty Corporation) was created by the New York Legislature in 1985 to protect New York state residents who are policyholders and beneficiaries of policies issued by an impaired or insolvent life and health insurance company, up to specified limits.
The guaranty corporation is a statutory not-for-profit corporation whose members consist of all life and health insurance companies licensed to do business in the state of New York. In the event that a member insurer is found to be insolvent and is ordered to be liquidated by a court, the guaranty corporation provides protection to New York residents who are holders of life and health insurance policies, annuity contracts and funding agreements with the insolvent life insurance company.
All life and health insurance companies licensed in New York to write life and health insurance are required, as a condition of doing business in the state, to be members of the guaranty corporation. If a member company becomes impaired or insolvent, money to continue coverage and pay claims is obtained through assessments of the guaranty corporation's other member insurance companies.
The New York Guaranty Corporation always covered health insurance policies issued by life insurance companies but in 2023 the law was changed to expand coverage to health insurance issued by health insurers including long-term care within the statutory limits. Generally, individual and group life insurance policies, health insurance policies, annuities, and funding agreements issued by life and health insurance companies licensed to do business in New York State are covered by the New York Guaranty Corporation.
The Life and Health Insurance Guaranty Corporation is not unique to New York. For example, the Maryland Life & Health Insurance Guaranty Corporation was created by the Maryland General Assembly in 1980 to protect Maryland residents who are policyholders and beneficiaries of policies issued by an insolvent insurance company, up to specified limits.
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The Life and Health Insurance Guaranty Corporation
Maryland also has a Life and Health Insurance Guaranty Corporation, which was created by the Maryland General Assembly in 1980 to protect Maryland residents who are policyholders and beneficiaries of policies issued by an insolvent insurance company, up to specified limits.
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Frequently asked questions
The Life Insurance Guaranty Corporation is a statutory not-for-profit corporation that protects policyholders of life insurance companies in the event of an insurance company insolvency.
The Life Insurance Guaranty Corporation was established in 1941, making New York the first state in the nation to set up a guaranty fund.
The Life Insurance Guaranty Corporation covers individual and group life insurance policies, health insurance policies, annuities, and funding agreements issued by life and health insurance companies licensed to do business in New York State.
The Life Insurance Guaranty Corporation protects New York residents who are holders of life and health insurance policies, annuity contracts, and funding agreements with an insolvent life insurance company.
