Tuesday, March 31, 2009

The Next Bailout Victim!

While AIG has received a lot of attention for bailouts and bonuses, the Los Angeles Times reports that the next wave of bailout victims could be life insurance companies. AIG's life insurance division has suffered massive losses due to bad investments. Allstate is another company that has suffered major losses but remains well capitalized according to reports.

I'm not sure if this figure is correct, but I've read that 78% of African American families don't have life insurance. If this number is indeed correct, it's a very sad commentary on our planning for final expenses. Worst case scenario, the government will make sure these companies honor their commitments to policyholders if that is necessary. Expect the losses to subside over time, however, as the companies become more conservative in their investment options.

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