Can Life Insurance Companies Go Bankrupt? 
Yes they can . Just like any company . However due to regulatory intervention , it 's extremely rare . Life insurers are checked often by state regulators for financial well being and must maintain certain capital positions based on their outstanding liabilities . They are required to maintain at a very minimum twice the amount of capital on hand needed to cover the expected claims they will incur in any given year . If they fall near or below this number , then regulatory action begins to try and place the insurer in a better financial position . Additionally , if a company should fail , other companies typically purchase their assets and back the promises made by the failing insurer . 