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 Posted: Tue Jan 12, 2010 7:32 am Post subject: Insurance company rating analysis |
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It's often told that the rating analysts would look into factors like an insurer's business strategies, risk management etc. Is there anyone who can give me a detailed account on how these analysts rate insurance carriers these days?
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Ringofan
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| Posted: Wed Jan 13, 2010 4:16 am Post subject: |
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| Look at an actual ratings analysis and see. They take into account a multitude of variables. And they descrive the methodology for their ratings when they make the ratings announcement. |
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BNTRS
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| Posted: Wed Jan 13, 2010 5:13 am Post subject: |
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| It's quite possible for you to determine the rating of your insurer. While doing so we must also remember that the rating system of one carrier may vary from another. Once we know this it would help prevent any rating confusion. |
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steven
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| Posted: Thu Jan 14, 2010 7:34 am Post subject: |
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I've come across an interesting note while surfing online. It says if an insurer's rating becomes public then it can't be removed.
On the other hand, if the carrier goes through a rating analysis and achieves a bad rating then it may reject the rating. Under such circumstances, it's rating will not be made public. |
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roddick
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| Posted: Fri Jan 15, 2010 5:13 am Post subject: |
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| There are a lot of other things that we'd need to remember. Your insurer might just opt out of a yearly rating analysis. This mostly occurs when they're heading towards a financial crisis. These are times when your insurer gets scared that their ratings might drop. |
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RupertWBradson
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| Posted: Sat Jan 16, 2010 9:29 am Post subject: |
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| Quote: | | While doing so we must also remember that the rating system of one carrier may vary from another. |
That's quite true. A. M. Best for instance are specialists in the insurance market-rating analysis. They will take into account a number of factors like the carrier's balance sheet, operating profile and productivity to arrive at their rating.
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Juanita
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| Posted: Sat Jan 16, 2010 10:09 am Post subject: |
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| They are! If you'd like to get rated by them, they'd charge you for their services. Such charges would primarily consist of their administrative expenses. |
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steven
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| Posted: Sat Jan 16, 2010 10:52 am Post subject: |
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I guess Fitch on the other hand would go through your statutory financial statements that are registered with your state regulators. They also examine your management reports and financial statements that have not been audited. Once they'd have an idea of your business projections it would be easier for them to rate your company.
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anonymous00
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| Posted: Mon Jan 18, 2010 7:02 am Post subject: |
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| Hi, I don't think Fitch recommends insurers on the basis of their ratings. I guess they'd consider a BB+ rating (or for that matter an even higher rating) to be "investment grade". They are also known for charging insurers towards such rating analysis. |
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steven
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| Posted: Wed Jan 20, 2010 3:50 am Post subject: |
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| Quote: | I've come across an interesting note while surfing online. It says if an insurer's rating becomes public then it can't be removed.
On the other hand, if the carrier goes through a rating analysis and achieves a bad rating then it may reject the rating. Under such circumstances, it's rating will not be made public. |
Possibly, but then the insurance carrier wouldn't have a rating by that company. The major rating agencies are AM Best, Fitch, S&P, and Moody's. These ratings are combined and major companies are put on the Comdex which is a percentile ranking of the company's overall financial status, 100 being best and 0 being worst (no one is actually a zero or one or anything close to that). |
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BNTRS
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| Posted: Wed Jan 20, 2010 7:14 am Post subject: |
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Hi BNTRS,
| Quote: | | These ratings are combined and major companies are put on the Comdex which is a percentile ranking of the company's overall financial status, |
This is something that could be really helpful for all of us!
Would you be able to explain how the ratings concerning a particular company get combined under circumstances that they vary with different agencies? Also, I'd like to know about the possible rank of any new insurance carrier in the Comdex.
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Birdygel
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| Posted: Wed Jan 20, 2010 3:46 pm Post subject: |
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| The ratings are for insurance companies, not the agencies. You'll never find a source for clearly evaluating the financial strength of an agency. I'm not sure I completely understand your question. |
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BNTRS
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