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What do A.M. Best Ratings Mean to Insurance Companies and to you?

Insurance companies take the ratings information issued by A.M. Best very seriously. Companies know a downgrade in an A.M. Best rating can mean a loss in customer confidence. It is also an indicator as to how attractive the company will be to investors. Customer confidence and new investors are essential when it comes to writing new business and remaining profitable. There are many factors that may make a company’s A.M. Best rating fall including:

  • A change in the insurance marketplace
  • A change in the company’s structure or management
  • A large number of claims paid
  • A reduction in the company’s financial reserves

The outlook assigned by A.M. Best to an insurance company is also important. The outlook is how A.M. Best expects the company to perform in the near future. The outlook can be positive, negative or stable.

A.M. Best’s Financial Strength Rating (FSR) is an independent opinion of an insurer’s financial strength and ability to meet its ongoing insurance policy and contract obligations.

Superior A+ – Assigned to insurance companies that have, in our opinion, a superior ability to meet their ongoing insurance obligations.

  • Excellent A – Assigned to insurance companies that have, in our opinion, an excellent ability to meet their ongoing insurance obligations.
  • Good B+ – Assigned to insurance companies that have, in our opinion, a good ability to meet their ongoing insurance obligations.
  • Fair B – Assigned to insurance companies that have, in our opinion, a fair ability to meet their ongoing insurance obligations. Financial strength is vulnerable to adverse changes in underwriting and economic conditions.
  • Marginal C+ – Assigned to insurance companies that have, in our opinion, a marginal ability to meet their ongoing insurance obligations. Financial strength is vulnerable to adverse changes in underwriting and economic conditions.
  • Weak C – Assigned to insurance companies that have, in our opinion, a weak ability to meet their ongoing insurance obligations. Financial strength is very vulnerable to adverse economic conditions.
  • Poor D – Assigned to insurance companies that have, in our opinion, a poor ability to meet their ongoing insurance obligations. Financial strength is extremely vulnerable to adverse changes in underwriting and economic conditions.

At Doyle & Ogden we recommend partnering with an A rated or better insurance company. This is just one of the ways we provide our customers with a quality insurance policy that offers the best coverage at the right price.

Have confidence in your insurance company.  Contact us for a quote today!