What is the purpose of the South Carolina Life and Health Insurance Guaranty Association?

The purpose of the South Carolina Life and Health Insurance Guaranty Association is to provide policy owner protection in the event that an insurer becomes insolvent. This association serves as a safety net for policyholders, ensuring that they continue to receive benefits and coverage even when their insurance company can no longer meet its financial obligations. It is designed to maintain public confidence in the insurance industry by reassuring policyholders that their policies will be honored, thus minimizing the financial loss to individuals if their insurer fails.

The other options do not accurately reflect the association's primary function. Approving policy forms relates to the regulatory role of the state insurance department rather than the guaranty association. Enforcing insurance regulations is a responsibility typically held by state regulators, not the guaranty association. Underwriting high-risk insurance applicants is a function of insurance companies themselves, not an insurance guaranty association, which primarily deals with policyholder protection rather than risk selection.