Life & Health · Chapter 20 · Guaranty Funds
L&H Guaranty Association Benefit Limits
Definition
The Association's liability is never greater than the insolvent insurer's own contractual obligations — it pays no more than the benefit or policy limit in the contract, and never penalties or interest. Aggregate limits per life across all policies: $100,000 in net cash surrender/withdrawal values for life insurance; $250,000 in net cash surrender/withdrawal values for deferred annuity contracts; $300,000 for all other benefits related to one life, including long-term care policies and cash values; and $500,000 for basic hospital expense, medical surgical, or significant medical expense health insurance policies (not including LTC).
In plain English
The payout ceilings when a life/health carrier fails: 100K life cash value, 250K annuity cash value, 300K everything else, 500K hospital-medical.
Exam tip
Ladder mnemonic — 100 (life CSV) → 250 (deferred annuity CSV) → 300 (all other) → 500 (hospital/medical-surgical). The exam swaps the 250 and 300 constantly.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
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