what happens to people with insurance policies if their insurance company goes under? especially those?
policies with a cash value like a split dollar policy? if you had one through met life, for example, and they went under, what would happen?
It depends where you live and what exactly happens to the company.
If the company gets sold to another company, chances are nothing will change in the policies other than possibly a different logo on the top of the statements. I worked for Clarica and it was bought out by Sun Life and absolutely nothing changed other than logo’s and marketing materials. Even on the statements the policies where still refered to by their original Clarica names. Some products were discontinued or re-branded, but all in force policies remained unchanged. Same case when Sun Life bought out Met Life, Prudential and all the other companies it bought out…
If the company goes bankrupt or insolvent, it depends where you live. If yo live in Canada for example you would likely be covered through Assuris (All insurance companies in Canada are required by federal, provincial and territorial law to be a member of Assuris if they sell life insurance). Assuris more or less insures insurance policies. They are a non-profit organization that protects policy holders from losses when an insruance company becomes insolvent.
Not sure where you’re from or if there is an organization like that where you are though.
