21.6 Florida Life and Health Guaranty Association
Florida statutes govern the nonprofit Life and Health Insurance Guaranty of Payments. The Florida Insurance Guaranty Association's (FIGA's) purpose is to protect policyowners, insureds, beneficiaries, annuitants, payees, and assignees of life insurance policies, health insurance policies, annuity contracts, and supplemental contracts against the failure of an insurer issuing such policies or contracts to perform its contractual obligations due to its impairment or insolvency. The association is governed by a Board of Directors of no fewer than five nor more than nine member insurers, with at least one member of the board being a domestic insurer. A member insurer is any person licensed to transact in this state any kind of insurance.
Coverage applies to any persons who are owners of or certificate holders under such policies or contracts and who:
- are residents of this state; or
- are residents of other states, but only if:
- the insurers which issued such policies or contracts are domiciled in this state; or
- such insurers never held a license or certificate of authority in the states in which such persons reside.
- such other states have associations similar to the Florida association; and
- such persons are not eligible for coverage by such associations
Coverage does not apply to any of the following.
- Fraternal benefit societies
- Dental service plan insurance
- Pharmaceutical service plan insurance
- Optometric service plan insurance
- Ambulance service association insurance
- Preneed funeral merchandise or service contract insurance
- Prepaid health clinic insurance
The association maintains three separate accounts: (1) The health insurance account, (2) the life insurance account, and (3) the annuity account. Borrowing between accounts for claims payments is permissible provided the amounts borrowed are restored to the appropriate accounts no less than annually.
If a domestic insurer is an impaired or insolvent insurer, or if a foreign or alien insurer is an insolvent insurer, the association may:
- guarantee or reinsure, or cause to be guaranteed, assumed, or reinsured, any or all of the covered policies of the impaired insurer;
- provide such moneys, pledges, notes, guarantees, or other means as are proper to assure payment of the contractual obligations of the impaired insurer pending action; and
- loan money to the impaired insurer.
The association's liability for the contractual obligations of the insolvent insurer will not exceed $100,000 in cash values, or $300,000 for all benefits including cash values, with respect to any one life. In no event can the association be held liable for any penalties or interest.
