ABSTRACT
State guarantee funds and insurance departments have been so overwhelmed by insolvencies that a group of receivers and regulators founded the Society of Insurance Receivers in 1991 to coordinate and standardize the way insolvencies are handled nationally. Even insurance companies that are considered to be strictly property and casualty (P/C) insurers often sell health insurance, selling a few percent of all commercial health insurance sold in the United States. Insolvencies in these companies will affect those who have health insurance policies with them. Both P/C and life and health insurers are also frequently linked in terms of sharing liability for insurance company insolvencies through state guarantee funds. A nonprofit research organization in Durham, North Carolina, released the results of a comprehensive study of insurance insolvencies in fifteen southern states and the District of Columbia. Widespread failures in the 1990s among major health insurance carriers will victimize large numbers of people across the nation.
