Insurance companies that issue annuities can go bankrupt. This is an extremely rare event given the regulatory overview that exists in the insurance industry, but it is possible.
Insurers are required to hold, at a minimum, two times the amount of capital vs. the amount of anticipated claims they could incur in any given year. Any insurer who falls near or below this level is subject to serious regulatory oversight to correct and improve their capital position.
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Insurers are required to hold, at a minimum, two times the amount of capital vs. the amount of anticipated claims they could incur in any given year. Any insurer who falls near or below this level is subject to serious regulatory oversight to correct and improve their capital position.