In our April 4, 2009 Blog Report we suggested that one of the reasons for wanting to sell a structured settlement annuity may be the concern for the continued financial viability of the insurance company making the payments.
It is important to know that most States have a Guaranty Association that will pay some but not necessarily all of the life insurance annuity payments in the event the insurance company is unable. In that regard:
1. The applicable State Guaranty Association is usually that of the State where you are resident at the time of the insurance company default;
2. The particulars, amount of coverage, and contact information for each Guaranty Assocation can be found here;
3. If you move from a State with higher coverage to a State with lower coverage (ie from Washington State to Michigan) and the insurance company defaults after you relocate then you would likely only be eligible for the reduced covereage of the new State of residence.
4. All coverages are conditioned on there being sufficient funds in the applicable State Guaranty Association.
If you want to learn more about the coverages in your particular State we suggest that you contact your State Guaranty Association and follow up.