When An Insurance Company Goes Bust

Law360, New York (December 10, 2008, 12:00 AM EST) -- The financial news coming out of the insurance industry lately has been anything but good.

American International Group (AIG), the nation's largest insurer, teetered on the verge of collapse until the federal government rushed in with an $85 billion bailout package. That initial package, however, has proved insufficient to stabilize AIG, so the government has responded with a new $150 billion financial rescue package for the faltering company.

Although not as dramatic as the turmoil facing AIG, other major insurers have begun reporting significant losses, in...
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