State RegulationsNY specificDifficulty 3/5
When the Life Insurance Company Guaranty Corporation of New York covers an insolvent insurer's unallocated group annuity or funding agreement obligations, what is the maximum aggregate benefit payable under N.Y. Ins. Law §7708?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under N.Y. Ins. Law §7708(a)(2), (c)(2), unallocated group annuity and funding agreement obligations carry a $1,000,000 aggregate cap — twice the $500,000 per-person limit that governs individual life and annuity benefits. Group accident and health coverage, by contrast, is unlimited under the guaranty provisions. Keeping the tiers straight matters when a plan sponsor asks what happens to a funding agreement after an insurer's liquidation.
Why the other options are wrong
- A) The $500,000 figure is the per-person aggregate limit for individual life and annuity benefits, not the unallocated group annuity ceiling.
- B) Sub-limits are not part of New York's structure under §7708; the group annuity cap is a single $1,000,000 aggregate.
- D) Unlimited coverage is the rule for group accident and health claims, not for unallocated group annuity obligations.
Memory hook
Guaranty tiers: $500K per person, $1M group annuity, unlimited only for group accident and health.