State RegulationsIL specificDifficulty 2/5
A policyholder asks how much of her lapsed insurer's life policy cash surrender value the Illinois Life and Health Insurance Guaranty Association protects. What is the cap?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
The protection schedule maintained under 215 ILCS 5/531.01 through 5/531.19 covers life insurance cash surrender and withdrawal values up to $100,000 per individual. That cap is deliberately lower than the $300,000 death-benefit cap, so a policyholder reading her guaranty protection must match the benefit type to the right ceiling.
Why the other options are wrong
- A) $300,000 protects life death benefits and also serves as the aggregate cap per insolvency, not cash surrender values.
- B) $500,000 is the health benefit plan benefit cap under the association's schedule.
- D) $250,000 is the annuity cap per annuitant, unrelated to life cash surrender values.
Memory hook
Death 300, cash 100 — the surrender-value cap is the smaller number.