What is one of the roles of the Life and Health Insurance Guaranty Association?

The Life and Health Insurance Guaranty Association exists primarily to protect policyholders in the event that their insurance company becomes insolvent. This association plays a crucial role in maintaining public confidence in the insurance system by ensuring that consumers are not left without coverage or benefits due to an insurer's financial failure.

By providing a safety net, the Guaranty Association helps to prevent chaos in the insurance market and offers a form of financial reassurance to policyholders, which can assist in preventing insurer insolvencies indirectly. This role is essential in safeguarding the interests of consumers and maintaining the stability of the insurance industry in North Carolina. In essence, it ensures that policyholders are able to receive at least some form of compensation or continuation of their benefits, even if their insurer cannot meet its obligations.

This fundamental duty aligns directly with the purpose of the Guaranty Association, distinguishing it from other options, such as selling policies or providing health screening services, which do not fall within its scope of responsibilities.