State annuity protection

Idaho Annuity Guaranty Protection: $250,000 Per Contract and $300,000 Per-Life Aggregate

Idaho generally provides up to $250,000 in present-value annuity benefits for each qualifying policy or contract, subject to a $300,000 aggregate with respect to one life. Major-medical benefits are subject to a separate $500,000 aggregate exception.

Idaho annuity protection at a glance

Per qualifying annuity policy or contract
$250,000
Each qualifying annuity policy or contract may receive up to $250,000 in present-value annuity benefits, subject to Idaho’s separate per-life aggregate.
Aggregate with respect to one life
$300,000
Most covered benefits are subject to a $300,000 aggregate with respect to one life. Major-medical benefits may instead be subject to a $500,000 aggregate.
Who provides protection
Idaho Life & Health Insurance Guaranty Association
The Idaho Life and Health Insurance Guaranty Association may provide statutory protection for covered obligations of impaired or insolvent member insurers, applying Idaho’s distinctive per-policy-or-contract annuity limit.
Insurer requirement
Member insurer
The issuing insurer must qualify as a member insurer under Idaho law, and the policy or contract must otherwise be covered under Chapter 43.

How the $250,000 limit works

Idaho first applies a $250,000 present-value limit to each qualifying annuity policy or contract. Covered benefits are then subject to the $300,000 aggregate with respect to one life, except for the statutory major-medical exception.

How Idaho’s two limits work together: If two qualifying annuities at the same member insurer each have $200,000 of covered value, both are below the $250,000 per-policy-or-contract limit, but together they remain subject to the $300,000 aggregate with respect to one life.

Unlike many states, Idaho applies the annuity-specific $250,000 limit to each qualifying policy or contract before applying the separate $300,000 aggregate with respect to one life.

Coverage limits are generally applied separately to each impaired or insolvent member insurer, subject to Idaho’s eligibility and interstate coordination rules.

After applying the $250,000 limit to each qualifying annuity policy or contract, Idaho applies the $300,000 aggregate with respect to one life.

  • A qualifying structured-settlement payee, or the beneficiary or beneficiaries of a deceased payee, may receive up to $250,000 in present-value annuity benefits, subject to Idaho’s eligibility and applicable aggregate rules. Rights acquired through a structured-settlement factoring transaction are excluded.

A $300,000 annuity example

Assume one eligible Idaho annuity contract has a covered present value of $300,000 when the member insurer becomes impaired or insolvent.

Annuity value

$300,000

Potential protection

$250,000

Possible receivership claim

$50,000

In this example, up to $250,000 may qualify for guaranty association protection, while the remaining $50,000 may remain a claim against the insurer’s receivership estate.

This example uses one contract. If several qualifying annuity contracts cover the same life, each contract has its own $250,000 annuity-specific limit, but the covered benefits remain subject to the $300,000 aggregate with respect to that life.

Which annuities are covered?

  • Fixed annuity

    Generally covered

    Each qualifying fixed annuity policy or contract may receive up to $250,000 in present-value annuity benefits, subject to the applicable $300,000 aggregate with respect to one life.

  • Fixed indexed annuity (FIA)

    Generally covered

    FIAs are generally covered to the extent of qualifying insurer-guaranteed benefits. Certain excess, uncredited, or forfeitable index-linked amounts may be excluded; however, when value is credited less frequently than annually, Idaho determines the value as though the earlier impairment or insolvency date were the contractual crediting date.

  • Multi-year guaranteed annuity (MYGA)

    Generally covered

    MYGAs are generally treated as fixed deferred annuities. Each qualifying policy or contract is subject to the $250,000 annuity-specific limit and statutory interest-rate restrictions, with covered benefits also subject to the applicable $300,000 per-life aggregate.

  • Variable annuity

    Guaranteed portions may be covered

    Only qualifying insurer-guaranteed benefits may receive protection; investment gains or losses borne by the contract owner through a separate account are generally excluded.

  • Registered index-linked annuity (RILA)

    Contract-specific

    For a RILA, qualifying insurer-guaranteed obligations may be covered, while portions where the contract owner bears market or index risk are generally excluded.

  • Unallocated annuity contract

    Limited situations

    Unallocated annuity contracts are generally excluded; however, a benefit specifically guaranteed to an individual is not treated as unallocated to that extent.

Who may qualify?

  • Residency is determined on the date of entry of a court order determining the member insurer to be impaired or insolvent.
  • For ordinary annuities, eligibility generally follows the legal owner or certificate holder. Structured-settlement annuities use separate payee and beneficiary rules.
  • A nonresident may qualify in limited circumstances when the issuing insurer is Idaho-domiciled, the person’s state of residence has a similar guaranty association, and the person is not eligible for coverage there because the insurer lacked the required license under that state’s guaranty law.
  • Idaho’s interstate coordination rules are designed to provide protection through only one state guaranty association and prevent duplicate guaranty coverage for the same obligation.
  • The issuing insurer must qualify as a member insurer under Idaho law, and the policy or contract must otherwise be covered under Chapter 43.

What is not covered?

  • Portions of a policy or contract that are not guaranteed by the member insurer, or where the policy or contract owner bears the investment risk, are generally excluded.
  • Interest, crediting rates, or similar factors above Idaho’s statutory limits based on Moody’s Corporate Bond Yield Average may be excluded.
  • If index-linked value is credited less frequently than annually, Idaho calculates the value as though the earlier impairment or insolvency date were the contractual crediting date and treats the resulting amount as credited and nonforfeitable.
  • Claims based on marketing materials, unauthorized side letters or riders, misrepresentations, extra-contractual claims, penalties, and consequential or incidental damages are generally excluded.

What happens when an insurer becomes impaired or insolvent?

  1. Identify the covered annuity policies or contracts

    Because Idaho applies the $250,000 annuity-specific limit to each qualifying policy or contract, the number and value of covered contracts matter before the separate per-life aggregate is applied. For an impaired insurer, the Association may act in its discretion with required approval; for an insolvent insurer, it must provide protection through an authorized method.

  2. Determine claimant, insurer, and contract eligibility

    The Association determines whether the claimant, issuing insurer, and policy or contract satisfy Idaho’s residency, ownership, member-insurer, coverage, and interstate coordination requirements.

  3. Apply the per-contract and per-life limits

    Idaho applies the $250,000 annuity-specific limit to each qualifying policy or contract, then applies the $300,000 aggregate with respect to one life.

  4. Coordinate amounts above guaranty protection with the receivership

    Amounts above the Association’s protection may remain claims against the impaired or insolvent insurer’s receivership estate, with any additional recovery depending on available estate assets and the receivership process.

How the guaranty system is financed

The Association is funded primarily through assessments of member insurers when funds are needed to carry out its obligations for impaired or insolvent member insurers.

Assessment allocation
Member insurers
Class B assessments are allocated among Idaho’s statutory accounts and among member insurers based generally on covered Idaho premiums received during the calendar year preceding the assessment, subject to the allocation rules in §41-4309.
Annual assessment cap
Defined by state law
Annual assessment cap — 2%. For each account, total Class B assessments against a member insurer in one calendar year generally cannot exceed 2% of that insurer’s Idaho premiums received during the calendar year preceding the assessment on policies covered by that account.
Premium-tax treatment
State-specific rule
Premium-tax treatment — 20% per year for five years. A member insurer may offset 20% of a qualifying non-Class-A assessment against Idaho premium-tax liability in the year of payment and in each of the following four years. Any unused annual offset cannot be carried forward or back.
Idaho assessment accounts
How the Association is funded does not change consumer coverage limits; Idaho still applies the $250,000 annuity-specific limit per qualifying policy or contract and the separate per-life aggregate.

What to know before buying

  • Idaho’s annuity-specific limit applies per qualifying policy or contract, while covered benefits with respect to the same life are also subject to the separate $300,000 aggregate.
  • Idaho prohibits insurers, agents, affiliates, and other persons from using the existence of the Guaranty Association for sales, solicitation, or inducement to purchase covered insurance. Association-prepared and Director-approved written information may be furnished on request.

How state protection differs from FDIC insurance

  • What it covers
    State protection: Idaho guaranty protection may apply to eligible contractual benefits under a qualifying annuity policy or contract.
    FDIC: Deposit insurance covers eligible funds held in an insured bank account.
  • What system stands behind it
    State protection: The Idaho Life and Health Insurance Guaranty Association is a nonprofit legal entity created by statute and funded primarily through assessments of member insurers.
    FDIC: Federally insured banking institutions support the FDIC fund.
  • Coverage-limit basis
    State protection: Idaho applies up to $250,000 in present-value annuity benefits with respect to each qualifying policy or contract, subject to the $300,000 aggregate with respect to one life.
    FDIC: FDIC limits aggregate deposits by depositor, bank, and ownership category.
  • Whether it applies to annuities
    State protection: Eligible annuity benefits may receive Idaho guaranty association protection, but annuity contracts are not bank deposits and are not insured by the FDIC.
    FDIC: That annuity is not a deposit and therefore has no FDIC insurance.

Sources and last verified

Last verified: October 5, 2026