California Does Protect Insurance Policyholders

James Flanigan’s column, “Insurance Won’t Suffer S&L-Like; Collapse” (Oct. 17), put the difficulties of the insurance companies into more realistic perspective.

However, Flanigan indicated that California does not have a guarantee system, a system in which all companies chip in to rescue the policyholders of an ailing member.

California does have such a system now. One measure established a state guarantee fund to pay consumer claims filed against health insurance firms that go bankrupt, and a separate bill covers life insurance claims. The bills became law in September.

DAVID J. PETERS

The writer is a Los Alamitos-based consultant to the insurance industry .