I don't think many of the states will have the money,especially states that have huge budget shortfalls and large numbers of retired seniors who have AIG annuities.Perhaps they'll start handing out IOU's to them too.
The annuities are separately funded from the credit default failures that have broken the main company. They are perfectly safe for the policyholders most of whom have no intention of giving up their annuity security for the failure of the many who chose the failure of equities. Any other insurance company, not as foolish as AIG, would be happy to purchase the retirement policies of AIG which is why they are not as yet selling them.
I have a monthly annuity from AIG that pays me monthly income for life plus lumps sums every five years for 20 years.
It seems to me that any company who bought that division would have to make good on the annuities.
Not paying out would make people afraid to buy new policies.
Read your prospectus. That income stream you're enjoying is guaranteed by nothing but the claim paying ability of your carrier. Once you annuitize your contract you're nothing more than a general creditor of the issuer.
Not that it matters. This wasn't AIG's problem but if the house is collapsing it's not a place I'd want to be.
too bad - thats where they - imho - ( first choice case and others) were insuring fraudulent securities scams and selling annuities right along with them ( see cali dept of insurance website - search H serrano - "first choice" and "TLC" and ESN-ISN insurance, tax lien scams - autos and homes, went into receivership and the receiver was on the board of an insurance company that sold aig annuities for petes sake...lol) early 2000's... thats how they bolstered their AAA rating... too bad the states did nothing with it - aig insured their fleets of cars and managed their pension money - so you cant go after them for fraud or rico... you'd lose your pension...