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Florida Life & Health Insurance Guaranty Association
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3740 Beach Boulevard, Suite 201-A / Jacksonville, FL 32207-3877 |
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Frequently Asked Questions  |
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What happens when my insurance company goes out of business?
In general, a court of competent jurisdiction will work with the department of insurance in determining when an insurance company requires special regulatory control. Some steps that might be taken are not publicly announced, but may include supervision of some kind. If early steps do not turn the company around, a period of public rehabilitation may follow. This means a receiver is appointed for purposes of operating the company more effectively. The receiver's power allows for strong actions to be taken, some of which might affect policies. In rare cases, the problems cannot be worked out and the court decides the company should be liquidated. This means that the receiver now becomes a liquidator who is charged with selling off the company assets for the benefit of policyholders and creditors. At the point of liquidation, FLAHIGA takes on the obligation of protecting Florida policyholders. We obtain the policy records and history from the liquidator, collect premiums that become due, administer the policies and pay all valid claims. FLAHIGA will normally continue coverage as long as premiums are paid or cash value exists. We may do this directly, or through service agents. Since FLAHIGA is a safety net but not an insurance company, we will seek to transfer policies to a sound insurer as soon as it is practical to do so. When possible under the terms of the policy, FLAHIGA may also elect to cancel policies after notice is given to you and after all valid claims have been paid. |
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| NOTE: This information is not intended as legal advice, and no liability is assumed in connection with its use. The applicable state guaranty association statute is the controlling authority, regardless of any information presented on this site. Users should seek advice from a qualified attorney and should not rely on this compilation when considering any questions relating to guaranty association coverage. |
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