The California Department of Insurance has updated the notice insurers in the state must provide when they deliver life, health and annuity contracts.
The new guaranty fund notice bulletin, Bulletin Number 2011-3, replaces a bulletin the department issued in 1996, and the revised requirements will take effect Sept. 26.
The new bulletin says the new summary document and disclaimer, which describes the coverage provided by the California Life and Health Insurance Guarantee Association (CLHIGA), must be provided both when an insurer delivers a policy and upon request by a policy owner.
The guaranty fund notice requirements are governed by California Insurance Code Section 1067.17(b)(2). The requirements apply to member insurers of CLHIGA and to non-member insurers authorized to do business in California, the bulletin says.
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In the notice of protection, an insurer is supposed to tell policyholders that CLHIGA will guarantee 80% of life insurance death benefits and 80% of cash surrender or withdrawal values, both of which are not to exceed $300,000.