2. Insolvencies anwng insurance conylanies have risen in recent years, The anwun~ of money assessed by state guaranty
finds to pay for insolvencies has increased as well.
Historically, life company failures and guaranty fund
assessments have been low. For example, from 1975 to 1982,
those assessments averaged $6.2 million a year. Recently,
however, life company failures have increased significantly.
For example, life guaranty fund assessments tripled from
$154.8 million in 1990 to $469.7 million in 1991. The problem
of insolvency of life companies is not limited to small companies. In April 1991, the California Department of Insurance seized Executive Life Insurance Company of California. Assessments for Executive Life of California could reach $400 million per year over five years. (p1)
1992 - California GOV - State Solvency Regulation of Property-Casualty and Life Insurance Companies - 144p
2018 - A Review of Root Cause in Insurer Insolvencies and Impairments, By Dave Heppen and Veronika Cooper, Society of Actuaries - 6p
Between January 1975 and December 1990, 170 life insurance companies failed--40 percent during 1989 and 1990.
- Most of these failed insurance companies were small.
- In April 1991, however, the California Insurance Commissioner placed the Executive Life Insurance Company in conservatorship.
- If this company eventually fails, it will be the largest U.S. insurance company ever to do so.
- Recently, a few other life insurance companies have been placed in conservatorship. (p1)
1991 - GAO - Insurance Company Failures Threaten Retirement Income -Testimony,T-HRD-91-41