The Bad PlaceNBC News Top Stories | She paid an insurance company $99,000 to generate retirement income for life. Then it collapsed. by Gretchen Morgenson
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Annie Benjamin paid $99,000 for a retirement annuity from PHL Variable Insurance Co., only to have the private‑equity‑backed insurer collapse in 2024, freezing her account and leaving her and roughly 100,000 other policyholders facing a $2.2 billion shortfall. The failure highlights a broader shift in the life‑insurance industry: companies once content with safe, high‑quality investments are now taking on risky, complex reinsurance deals—often hidden in confidential filings and backed by assets that don’t meet standard accounting rules. State regulators, who are supposed to guard policyholders’ money, have been slow to police these practices, allowing thin capital cushions and “excess‑of‑loss” agreements that can evaporate when needed. As a result, many retirees risk receiving only a fraction of promised payouts, exposing a growing vulnerability in an industry that increasingly underpins retirement income for Americans.
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