AIG life insurance holders-what happen

what happens to AIG life insurance holders?

 

i know an older guy who has a 2 million dollar life insurance policy with AIG. if AIG go bankrupt will his policy just be transferred to another company?

 

http://online.wsj.com/article/SB122152624211640147.html?mod=googlenews_wsj

 

Does anyone honesty think AIG will just "go away"?

 

i guess the policy will be transferred to another company?

 

Mostly yes. If his policy is term, no problem at all.

If his policy is whole life and has cash values, it's still likely safe. "Cash Value Reserves" have restrictions upon how they can be invested... state insurance divisions set conservative standards.

 

he has term insurance. he's safe for the remaning 15 years left on his term?

 

policy holders are "covered", unless their policy is of an extraordinary amount.

 

Yes. Most companies retain only a portion of the face amount and reinsure the balance with one or more reinsurance carriers.

To my knowledge, there has NEVER been a default on a death claim in the US.

 

Even for extraordinary amounts...