What does the California Insurance Guarantee Association (CIGA) primarily insure?

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Multiple Choice

What does the California Insurance Guarantee Association (CIGA) primarily insure?

Explanation:
CIGA is designed to protect the people who hold policies with an insurer that has become insolvent. When an insurer fails, CIGA steps in to pay the policyholders’ covered claims up to statutory limits, helping ensure they don’t lose their protection entirely. This safety net is funded by assessments on other solvent California insurers and only activates in the event of insolvency. So, the emphasis is on policyholders of insolvent insurers, not all insureds in California, not the general public, and not limited to employers.

CIGA is designed to protect the people who hold policies with an insurer that has become insolvent. When an insurer fails, CIGA steps in to pay the policyholders’ covered claims up to statutory limits, helping ensure they don’t lose their protection entirely. This safety net is funded by assessments on other solvent California insurers and only activates in the event of insolvency.

So, the emphasis is on policyholders of insolvent insurers, not all insureds in California, not the general public, and not limited to employers.

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