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Alabama Life & Disability Insurance Guaranty Association
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6 Office Park Circle, Suite 200 / Birmingham, AL 35223 |
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Frequently Asked Questions  |
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What will happen to my insurance coverage if the guaranty association becomes liable for my policy?
In general, your policy will be continued under its terms and conditions while ALDIGA determines its course of action. Valid claims will be paid, premiums will be collected and your policy will continue under ALDIGA administration. However, since ALDIGA is not an insurance company, efforts will be made to find another viable insurance company that is willing to acquire the policies. If this happens, you will be notified in advance and ALDIGA will fund the transfer process. If no viable market exists for the policies of the liquidated insurer, ALDIGA may cancel the policies, in accordance with the policy terms, but only if that right was available to the insurer had a liquidation not occurred. Depending on the type of policy, state or federal law may impose extensions of the time for which you are covered even after a cancellation. ALDIGA also has the authority under the ALDIGA Act to offer substitute policies of substantially the same type.
In most insolvency situations, ALDIGA works with other state guaranty associations to develop an overall plan to provide protection for the failed insurer's policyholders. The amount of protection provided, and when you receive it, may depend on the particular arrangement worked out but you will be entitled to the benefits of ALDIGA protection and coverage to its limits. |
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| NOTE: This information is not intended as legal advice, and no liability is assumed in connection with its use. The applicable state guaranty association statute is the controlling authority, regardless of any information presented on this site. Users should seek advice from a qualified attorney and should not rely on this compilation when considering any questions relating to guaranty association coverage. |
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