Ratings of the abundant amount of auto insurance companies out there by multiple factors such as rates and financial strength. Carriers are rated just like how movies are; subjected to a measuring standard and then given a score. Standards are established to a threshold of sustainability in the financial market or consumer market and each carrier is compared to this standard to reflect the company’s strength. There are other factors that many insurance companies are measured to other than their financial status. Other areas such as the types of policies offered, quality of service, and pricing. Both financial and company service measurements are done by third party organizations so as to ensure objectivity to the measurements and to avoid any type of bias in the reports.
One reputable organization that rates the industry is A.M. Best. They rate insurance companies based on their financial strength. A.M. Best has three types of financial ratings: Financial Strength Ratings, Issuer Credit Ratings, and Debt Ratings and each of the types of ratings having their own standards and measurements that are compared to the respective carriers. The Financial Strength Rating measures the strength of the company financially and their likelihood to continue to meet their obligations to policyholders if anything were to occur. The Issuer Credit Ratings is an abstract rating of a company in their ability to meet large obligations. And the Debt Rating is a rating placed on the company’s health based on their returns from debt in projected future time. A.M Best uses a rating system of letters, A++ being the best and E or F being the worst scenario.
Another rating that insurers are measured to is the ratings provided by J.D Power. Their ratings rate the companies based on the types of policies offered and if they offer flexibility in the choice of policies, pricing, billing and payment, and contacting the insurer. J.D Power bases their ratings off of customer surveys and questionnaires of the respective carriers and ranks the results in the basis of 1-5, 5 being the best.
Auto insurance company rates and reviews
The ratings provide a good report for consumers as to the company’s financial standing in the market and customer’s feelings towards the company. Ratings, along with auto insurance rates can be used by consumers in ranking the companies based on their interpretation of the readings, what consumers value most from a company, and what other’s have said. Similar to a consumer’s credit score when they are planning to purchase or take out a loan, the motorists may utilize these scores in choosing which carrier they feel the most comfortable with before signing a policy. Ratings are a good way of gauging which company to choose but one of the most important variable in selecting an insurer is the quote that they will be giving to the consumer. OnlineAutoInsurance.com provides quotes for many of the companies that are rated and will generate a quote to the consumer so as the consumer may have not only the ratings but also quotations to make the best choice.
Comparison chart for car insurance ratings
The rating and review process is provided to consumers by AM Best using the following comparison chart:
- A++ and A+ (Superior) = superior ability to meet their ongoing obligations to policyholders
- A and A- (Excellent) = excellent ability to meet their ongoing obligations to policyholders
- B++ and B+ (Good) = good ability to meet their ongoing obligations to policyholders
- B and B- (Fair) = fair ability to meet their ongoing obligations to policyholders
- C++ and C+ (marginal) = marginal ability to meet their ongoing obligations to policyholders
- C and C- (weak) = weak ability to meet their ongoing obligations to policyholders
- D (poor) = weak ability to meet their ongoing obligations to policyholders
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