There are many cases where many insurance companies get closed or merged into another company. In case of merger the new company will take care of the insured person's from the previous company and send notice as well as new rules and regulation of the respective policies applied for. In case of closer of the insurance company the insurance commissioner of the respective area or state where the company registered can find a new buyer under the obsolete company's policies. Incase the commissioner could not find any buyer than the state guaranty fund gives complete coverage to the insured persons.
The selection of the local insurance companies is very much important. You can also see the company financial position through their annual report of rating agencies. If possible select the bigger group rather than small company because in long-term insurance you must select the company, which gives complete coverage at the time of any health challenges.
Incase of the closer of the company, if new company get takeover it and the chances are more for increase in rate of the premium and might coverage get change.
