State RegulationsGA specificDifficulty 2/5
A Georgia resident is covered under an individual health benefit plan issued by an insolvent insurer. Under the Georgia Life and Health Insurance Guaranty Association Act, the association's maximum obligation for that health benefit plan is:
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under O.C.G.A. § 33-38-7(a)(12)(B)(ii), the guaranty association covers disability income, long-term care, and other health insurance at $300,000, but health benefit plans receive a higher cap of $500,000. The elevated ceiling for health benefit plans is also echoed in the aggregate cap, which rises to $500,000 per individual for such plans. Distinguishing 'other health insurance' from a 'health benefit plan' is the key to the correct figure.
Why the other options are wrong
- A) $100,000 is the life cash surrender value cap and has no application to health benefit plans.
- B) $250,000 is the annuity net cash surrender value cap, not a health figure.
- C) $300,000 is the cap for other health insurance such as disability income and long-term care, not for health benefit plans.
Memory hook
Health benefit plans are the VIP tier — 500K while other health rides at 300K.