What are insurance ratings?

Insurance ratings rank the financial strength of insurance companies. These ratings, similar to a credit rating, are the result of efforts of independent agencies whose job it is to report their findings.

Unfortunately, the ratings of all insurance companies are speculative and vary depending on the rating agency. These ratings look at the insurance company's ability to pay claims made by policyholders but do not examine the strength of a company's ability to perform for shareholders.

Generally, the rating scale used by a rating agency varies and the best rating a company may receive is an "A++." However, some companies show their highest rating by using "AAA."