Most states maintain a permanent reserve fund to resolve insurance company failures.

Question

Quizplus · Accepted Answer

Most states do not maintain a permanent reserve fund specifically for resolving insurance company failures; instead, they have guaranty associations or similar mechanisms that provide protection to policyholders in the event of an insurance company failure. These associations are typically funded by assessments on insurance companies after a failure occurs.

Most States Maintain a Permanent Reserve Fund to Resolve Insurance