INSURANCE COMPANY FINANCIAL PROBLEMS
I have previously posted about the ongoing and anticipated effects of the current financial crisis on the insurance industry as a whole. Now, it’s getting personal.In 1984, my wife and I purchased Universal Life Insurance on both of our lives with Shenandoah Life Insurance Company. We have faithfully paid the premiums for the policies for the 25 years since that time. In fact, for a period of time we even paid more than the required minimum premium. In my calculation, we have paid at least $50,000 in premiums to them since the inception of the policy.I just learned that the Virginia Department of Insurance has placed them under supervision. According to the Questions and Answers document, the receivership was necessary due to the declining value of some of the company’s investments. In other words, they took premiums from policyholders and invested the premiums, and the investments of those funds didn’t pan out.As I posted earlier, whether you are shopping for insurance, paying for an insurance policy, or making or litigating claims…….be aware of the insurance company’s financial status.Unfortunately for all of us, this ain’t nearly over yet, we still can’t see the bottom and how deep it is for the insurance industry.