Understanding State Guaranty Association Protection

Each state maintains its own Guaranty Association, which serves as a financial safety net in the event that an insurance company becomes insolvent. It is similar to the FDIC for banking institutions, but there are significant differences. These associations operate under specific state laws that define the types of insurance they cover and the limits on benefits they may provide. In most cases, protection applies to individual policyholders and their beneficiaries—but not to funds held within unallocated group contracts. Additionally, many states prohibit insurance companies and agents from using the existence of these funds as a marketing tool.

The information presented below is provided by Diversified Insurance Brokers and is intended for general informational purposes only.

It’s important to understand that the type and extent of coverage provided by a state guaranty association can vary significantly based on a variety of factors. To get detailed and accurate information about the protections available for any policy you’re considering, we encourage you to contact your state’s Department of Insurance. You can also find valuable information through the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA):
🔗 https://nolhga.com/the-guaranty-system/guaranty-association-laws/

State	Max Annuity Present-Value	Max Death Benefit per Life	Max Cash/Withdrawal Value	Max Aggregate Benefits
Alabama	$250,000	$300,000	$100,000	$300,000
Arizona	$250,000	$300,000	$100,000	$300,000
Arkansas	$300,000	$300,000	$300,000	$300,000
California	80% not to exceed $250,000	80% not to exceed $300,000	80% not to exceed $100,000	80% not to exceed $300,000
Colorado	$250,000	$300,000	$100,000	$300,000
Connecticut	$500,000	$500,000	$500,000	$500,000
Delaware	$250,000	$300,000	$100,000	$300,000
District of Columbia	$300,000	$300,000	$100,000	$300,000
Florida	$250,000	$300,000	$100,000	$300,000
Georgia	$250,000	$300,000	$100,000	$300,000
Idaho	$250,000	$300,000	$100,000	$300,000
Illinois	$250,000	$300,000	$100,000	$300,000
Indiana	$250,000	$300,000	$100,000	$300,000
Iowa	$250,000	$300,000	$100,000	$300,000
Kansas	$250,000	$300,000	$100,000	$300,000
Kentucky	$250,000	$300,000	$100,000	$300,000
Louisiana	$250,000	$300,000	$100,000	$500,000
Maine	$250,000	$300,000	$100,000	$300,000
Maryland	$250,000	$300,000	$100,000	$300,000
Massachusetts	$250,000	$300,000	$100,000	$300,000
Michigan	$250,000	$300,000	$100,000	$300,000
Minnesota	$250,000	$500,000	$130,000	$500,000
Mississippi	$250,000	$300,000	$100,000	$300,000
Missouri	$250,000	$300,000	$100,000	$300,000
Montana	$250,000	$300,000	$100,000	$300,000
Nebraska	$250,000	$300,000	$100,000	$300,000
Nevada	$250,000	$300,000	$100,000	$300,000
New Hampshire	$250,000	$300,000	$100,000	$300,000
New Jersey	$250,000	$500,000	$100,000	$500,000
New Mexico	$250,000	$300,000	$100,000	$300,000
New York	$500,000	$500,000	$500,000	$500,000
North Carolina	$300,000	$300,000	$300,000	$300,000
North Dakota	$250,000	$300,000	$100,000	$300,000
Ohio	$250,000	$300,000	$100,000	$300,000
Oklahoma	$300,000	$300,000	$100,000	$300,000
Oregon	$250,000	$300,000	$100,000	$300,000
Pennsylvania	$250,000	$300,000	$100,000	$300,000
Rhode Island	$250,000	$300,000	$100,000	$300,000
South Carolina	$300,000	$300,000	$300,000	$300,000
South Dakota	$250,000	$300,000	$100,000	$300,000
Tennessee	$250,000	$300,000	$100,000	$300,000
Texas	$250,000	$300,000	$100,000	$300,000
Utah	$200,000	$500,000	$200,000	$500,000
Vermont	$250,000	$300,000	$100,000	$300,000
Virginia	$250,000	$300,000	$100,000	$350,000
Washington	$500,000	$500,000	$500,000	$500,000
West Virginia	$250,000	$300,000	$100,000	$300,000
Wisconsin	$300,000	$300,000	$300,000	$300,000
Wyoming	$250,000	$300,000	$100,000	$500,000

State Guaranty Association — FAQs

What is the State Guaranty Association?

A State Guaranty Association is a state-based safety net that steps in if an insurer becomes insolvent. It ensures that policyholders are protected up to state-defined limits.

What types of policies are covered?

Policies typically covered include life insurance, health insurance, annuities, disability, and long-term care contracts. Certain riders and non-insurance products may be excluded.

What benefits are protected?

Death benefits, cash values, annuity benefits, and sometimes disability income are protected—up to the maximum amount specified by state law.

What are the coverage limits?

Limits vary widely by state and by product type. Some states cap cash value, others cap total death benefit. It’s vital to check the guaranty association limits in your state for your specific policy type.

Does the protection cover unpaid claims?

Yes. If the insurance company becomes insolvent, unpaid valid claims may still be paid out under the guaranty association protection, subject to state limits and rules.

Are policy loans and surrender values protected?

Typically, yes—cash value and policy loans are protected, though they may be subject to state limit reductions and certain exclusions depending on the policy and rider structure.

Does this protect premiums I’ve already paid?

It generally does. Premiums paid into policies—particularly those tied to cash value or guaranteed benefits—are part of what the guaranty association protects, when tied to valid policy features.

How can I find the guarantee limits in my state?

Contact your state department of insurance or visit your state guaranty association’s website. They usually publish coverage limits by product type so you know what your protections are.

Do state guaranty protections affect my policy’s performance?

No. They don’t change how your policy earns interest or dividends, but they give reassurance that in the rare event of insurer failure, you’ll still get certain benefits up to the maximum state-protected amounts.

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About the Author:

Jason Stolz, CLTC, CRPC, is a senior insurance and retirement professional with more than two decades of real-world experience helping individuals, families, and business owners protect their income, assets, and long-term financial stability. As a long-time partner of the nationally licensed independent agency Diversified Insurance Brokers, Jason provides trusted guidance across multiple specialties—including fixed and indexed annuities, long-term care planning, personal and business disability insurance, life insurance solutions, and short-term health coverage. Diversified Insurance Brokers maintains active contracts with over 100 highly rated insurance carriers, ensuring clients have access to a broad and competitive marketplace.

His practical, education-first approach has earned recognition in publications such as VoyageATL, highlighting his commitment to financial clarity and client-focused planning. Drawing on deep product knowledge and years of hands-on field experience, Jason helps clients evaluate carriers, compare strategies, and build retirement and protection plans that are both secure and cost-efficient.