Interested in procuring life insurance?
Whole, Universal, Variable, Term, etc? Before you do anything. You first need to check the Life Insurance Ratings.
What is a Life Insurance Rating?
A life insurance rating is a Financial Strength Rating, which is issued by one of the three Credit Rating Agencies or AM Best.
The Financial Strength Rating is different than a Issuer Credit Rating in that it measures an insurer’s ability to pay “claims.” This is what you are looking for. An issuer credit rating has more to do with repaying debt.
Here are the Four Companies that issue Financial Strength Ratings:
Each one of these four companies has their own version of how to Financial Strength Rating. This term can be abbreviated as FSR or IFS Rating. They all mean essentially the same thing.
Financial Strength Rating Scale:
Each company has their own financial rating scale which precludes you from cross referencing with each other.
General Best Practices with Financial Strength Ratings for Consumers:
Check at least with two different rating agencies.
Consider buying only from A rated carriers.
Check the ratings yourself and do not rely on old outdated documents or websites.
Ask if you do not understand something.
Always check a financial strength rating with the purchase or purchase consideration of any form of life insurance.
If your agent is not familiar with FSRs, consider finding someone that does.