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Comparing A+ Rated Insurance Companies

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A+ Rated Insurance CompaniesWhen choosing an insurance provider, company ratings are of great importance.

Whether it’s an annuity account, Medicare supplement, life insurance policy, or long term care coverage – you want assurances your chosen company will be there for the long run.

All insurance is an investment in your future. Knowing you have an A+ rated carrier backing your health or investment provides stability, strength, and most importantly, peace of mind.

Which Firms Rate Insurance Companies?

There are several rating agencies that help consumers understand the overall financial strength of insurance companies. AM Best, Moody’s, Standard & Poor’s, Fitch, Weiss, and COMDEX are valuable resources when you’re comparing carriers.

These all use different rating metrics, but by visiting their websites, you can get a good feel for the companies you wish to compare. Many factors contribute to an insurance company’s rating including market capitalization, operating margins, assets & liabilities, reserves, surpluses, debt ratings, and the nature of their business among other items.

AM Best tends to be the company consumers turn to most, but Weiss and COMDEX provide valuable insight into company financials as well.

Request A Yearly Financial Report

Every year insurance companies are required to release their financial information from the previous year. When you’re deciding between similar well-rated companies, this information can help to make the decision. You’ll want to pay attention to data like:

  1. Market Capitalization (size of the company)
  2. Years in Business
  3. Financial Strength (surplus assets)
  4. Assets vs Liabilities
  5. Revenues (increasing vs decreasing)

The items above will tell you a lot about the overall health of an insurance company. If the numbers are improving year over year, then you can expect rating upgrades in the future.

Should I Worry About Lower Rated Insurance Companies?

Best Rated Insurance CompaniesNot necessarily. There are several B+ to A- rated insurance companies with very strong financials.

They are typically just smaller companies that are growing. AM Best and other rating agencies typically give the highest ratings to the largest companies with multi-billion dollar portfolios.

Your decision depends on the type of policy you are considering.

There is little danger to working with a smaller company when you’re purchasing a dental & vision or Medicare Supplement insurance policy.

If, however, you are investing in a large annuity policy or buying a jumbo life insurance policy, then securing a contract with an A+ rated insurance company makes sense. We take it on a case-by-case basis. Our clients will tell us what they are looking for in an insurance company.

Oftentimes, you’ll find higher interest rates or stronger benefits with lower-rated insurance companies. That’s because they are smaller and more nimble with their portfolios. The largest companies can’t always match annuity rates or death benefits simply because their portfolios are too big to capture the highest yields available.

In the end, it’s a tradeoff. There is a balance as to what rating and premium costs give you the most comfort. As an independent brokerage, we help our clients find the happy medium.

Do Ratings Affect How My Policy Is Insured?

The short answer is no. Higher ratings might better predict how likely insurance companies are to pay claims, but they don’t affect their belonging to the Guaranty Association.

Each state has its own Association. In order for a company to do business there, it must be first approved by the respective Department of Insurance. Then they are part of the Guaranty Association. This is the massive entity that provides protection in the event an insurance company becomes insolvent and fails.

Insurance Departments do not have to grant all requests for a company to sell in their State. If the company is approved, they are by default part of the Guaranty Association. Thus, your policy is insured no matter the rating of the insurance company itself.

Let’s Look At Some A + Rated Insurance Companies

Of course, the best solution is to find a highly rated insurance company offering the highest annuity rates or the lowest premiums and strongest benefits.

Highly Rated Annuity Companies

There are several strong insurers to choose from in this category. And it’s comforting to know many smaller companies grow either get purchased or have a rating increase.

Both Reliance Standard and New York Life carry A++ ratings. That’s the highest available.  Midland National, North American Life, Securian, Integrity Life, Great American, Mutual of Omaha, Lincoln, Protective, and Nationwide all have A+ ratings.

You can’t go wrong with any of these, but you’ll find competitive rates with many companies in the B++ to A rated segment as well.

The Best Rated Life Insurance Companies

Buying a comprehensive life insurance policy is a big investment in your future. It makes sense to find a highly-rated company for these policies.

Our clients like Lincoln Financial, Minnesota Life, Pacific Life, Principal, Protective Life, Prudential, John Hancock, Securian, Banner Life, and Columbus Life just to name a few. There are quite a few others with high rankings as well.

Whether it’s a term, whole, or guaranteed universal life policy, you want a stable company now more than ever. Claims have increased over the last few years, so it’s wise to choose one with strong reserves and ample surpluses.

Medicare Supplement, Advantage, and Long Term Care Insurers

There’s good news here as well. You’ll find several safe & secure carriers area available. These are companies you can count on for comprehensive coverage for the long run.

Several of our clients purchase policies with A+ rated United Healthcare, Mutual of Omaha, Allstate, Medical Mutual of Ohio, TransAmerica, USAA, State Farm, and One America State Life among others.

While many of these companies specialize in Medicare Supplement insurance, they also provide ancillary coverage like dental and vision as well. It’s nice when you can bundle all of your policies with one, well-rated company.

Contact Us To Discuss Your Options

There are nuances to almost all insurance policies. You don’t always want to shop on rating alone, but it’s a very important part of the equation. This is true when you are investing in annuity policies or purchasing a large life insurance or long term care plan.

That’s why it’s important to work with an independent brokerage like ours. We can help you compare highly-rated A+ rated insurance companies offering the best rates and benefits.

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