How Can I Determine the Financial Strength of My Insurance Company?

How do you compare life insurance companies? What features do you examine? What criteria do you use? How do you know what to look for? Making sure that your insurance company is financially sound is an important part of helping to ensure family security.

Fortunately, there are a number of independent companies that make these evaluations. These rating companies carefully examine each insurance company in the areas of profitability, debt, liquidity, and other factors. From the results of these examinations, they then issue overall ratings.

Looking up a company’s rating will provide you with a snapshot of that company’s financial health. Tracking the company’s rating on a regular basis may give you some advanced warning of trouble.

The four most prominent rating companies are A.M. Best, Standard & Poor’s, Moody’s Investors Service, and Fitch Ratings. Each of these services uses slightly different criteria when rating companies. As a result, each may have a slightly different view of a given company. A.M. Best ratings are based on financial conditions and performance; Moody’s, Fitch Ratings, and Standard & Poor’s ratings are based on claims-paying ability.

You should be able to find copies of at least one of these ratings in the reference section of your local library. If you are unable to find them, or if the ratings in your library are outdated, you can contact the services directly. All four services will provide ratings over the phone.

A.M. Best Company: 908-439-2200, www.ambest.com

Standard & Poor’s: 877-772-5436, www.standardandpoors.com

Moody’s Investors Service: 212-553-0377, www.moodys.com

Fitch Ratings: 800-893-4824, www.fitchratings.com

The information in this article is not intended to be tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2012 Emerald Connect, Inc.

PAG DISCLOSURE:

This site is only intended for clients and interested investors residing in states and countries in which Private Asset Group LLC is qualified to conduct investment advisory services. Private Asset Group LLC is a state registered investment adviser located in Las Vegas, Nevada. Private Asset Group LLC may only transact business in those states or countries in which it is registered, or qualifies for an exemption or exclusion from registration requirements. For non-clients of the firm, Private Asset Group LLC's website is limited to the dissemination of general information pertaining to its investment advisory services. .

Please contact Private Asset Group LLC at 702-932-8626 to find out if we may conduct advisory business in the state or country where you reside. Accordingly, Private Asset Group LLC does not, and will not, effect or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, through this website. Any subsequent, direct communication with a prospective client shall be conducted by a Private Asset Group LLC representative who is either registered or qualifies for an exemption or exclusion from registration in the state or country where the prospective client resides.

At certain places on our website we offer direct access or ‘links’ to other internet websites. These sites contain information that has been created, published, maintained or otherwise posted by institutions or organizations independent of Private Asset Group LLC. Private Asset Group LLC does not endorse, approve, certify or control these websites and does not assume responsibility for the accuracy, completeness or timeliness of the information located there. Visitors to these websites should not use or rely on the information contained therein until consulting with an independent finance professional. Private Asset Group LLC does not necessarily endorse or recommend any commercial product or service described at these websites.