We derive the optimal economic ruin boundary for an insurer when regulation requires an immediate capital contribution to offset a capital deficit. This boundary establishes the financial conditions under which shareholders no longer add capital to a distressed insurer. We describe this event as "economic ruin." Recognizing the possibility of economic ruin and the value of the abandonment option, we show that capital volatility is not a determinant of the insurer's market value and that capital increases this value dollar for dollar. Equivalently, the wealth of an insurer's shareholders is independent of the capital that they provide the insurer.