Life Insurance Company Rankings
As consumers, we are presented with so many arrays of products that it can be hard to make a choice at times. In order to cope with this deluge of information and details that are designed to whet the shopper in each one of us, we have developed our own methods of making our selection.
Our selection criteria are normally based on cost and quality of products. For commodities such as clothes, food, tools and many more, we place emphasis on a high level of standard at a reasonable price. In the event that we go for a product that has a higher or lower price than its counterparts, there is often a special criterion that we have evaluated in order to arrive at that choice.
The same kind of principle is also applied on picking our life insurance policies. As consumers, we have the right to expect that the company we choose to put our trust in is a solid and reputable one that will take care of financially empowering our loved ones in return for the premiums we have paid for, when the time comes for us to leave this world.
For this reason, we want to be affiliated with a strong and financially solid insurance company who can provide us with competitive packages and provide competitive compensation for our families in the future.
One way we can check if the insurance firm is a reliable insurance provider or not is by checking the life insurance company ranking it is accorded with, compared with the other top-caliber firms offering the same range of insurance plans.
Most rankings are based on information that comes from the top financial rating institutions such as A.M. Best, Moody’s, Standard and Poor’s (S&P), and Fitch. These rating bodies provide information regarding the future financial outlook of an insurance company and its capability to meet insurance and economic demands. The following tables show some ratings given by these companies including a brief explanation of each:
A.M. Best Rating
A++, A+ Superior Able to meet insurance obligations
A, A- Excellent Able to meet insurance obligations
B++, B+ Good Able to meet insurance obligations
B, B- Fair Vulnerable to unfavorable economic conditions
C++, C+ Marginal Vulnerable to unfavorable economic conditions
C, C- Weak Very vulnerable to unfavorable economic conditions
D Poor Extremely vulnerable to unfavorable economic conditions
E Under Supervision Company is under regulation, preventing normal business operations
F In Liquidation Company is ongoing voluntary liquidation
S Suspended Unevaluated due to inadequate information or lack of cooperation
AAA Extremely Strong Market conditions are unlikely to affect a fundamentally strong position
AA Very Strong High-grade company with marginally larger long-term risks
A Strong Financially secure, but signs of possible long-term susceptibility
Baa Adequate Lacking in certain protective elements over the long term
Ba Questionable Ability to meet obligations is questionable
B Poor Long-term ability to meet obligations on time is small
Caa Very Poor May be in default of financial obligations already
Ca Extremely Poor In default of financial obligations
C Extremely Poor Very poorly positioned to offer financial security
S&P Best Rating
AAA Extremely Strong Very unlikely to be affected by adverse economic conditions
AA Very Strong Unlikely to be affected by adverse economic conditions
A Strong Marginally more likely to be affected by adverse economic conditions
BBB Good May be affected by adverse business conditions
BB Marginal Adverse business conditions may lead to inability to meet obligations
B Weak Adverse business conditions are likely to affect ability to meet obligations
CCC Very Weak Depends on favorable business conditions to meet obligations
CC Extremely Likely to not meet all financial obligations
R Regulatory Action Subject to regulation due to insolvency
NR Not Rated No opinion
AAA Exceptionally Strong Very unlikely to be affected by adverse economic conditions
AA Very Strong Not significantly vulnerable to adverse economic conditions
A Strong Low expectation for interruption of payments
BBB Good May be affected by adverse economic conditions
BB Moderately Weak Contractual obligations are now vulnerable
B Weak Significant risk for interruption of payments
CCC Very Weak Strong likelihood for interruption of payments
CC Extremely Weak Interruption of payments is probable
C Distressed Interruption of payments is imminent
The secret to finding a reliable insurance partner is to make sure that you are aware of the company’s financial rating and ranking in the service it provides to policy owners. The ratings that are assigned to these insurance companies are very significant because they are the consumers’ assurance that the company is able to pay when you file claims and provide your benefits to your family in the event that something untoward happens to you.
So before you sign on as a policy owner for that particular insurance company you have been eyeing, check out the its ratings over the Internet, test this with the broker or agent, and then base your judgment on the summary. Do not go for a company that has a questionable ranking and grade. It is your money and life that are on the line so make sure you only go for the best and most secure company for your benefits.