Question

Which of the following is true regarding the California Insurance Guarantee Association?

a. The Association is directed by a 9 member Board of Governors who are elected by voters for a two year termb. The maximum claim covered would be $500,000 or the policy limitc. The purpose of the association is that each member be provided with insolvency insuranced. The association is funded by its member insurers

Answer 1

It is true regarding the California Insurance Guarantee Association that the association is funded by its member insurers.

Option: (D)

Step-by-step explanation:

• The amount of maximum claim that can be covered through a policy provided by the CIGA is $300,000.
• Other than its member insurers, the association is also funded through investment income and from the sale of the assets kept as collateral by insolvent member insurers.
• The general purpose of the association is to help an insolvent insurer by paying for the obligations on his name.