Understanding AM Best Ratings

Transcript

1 Understanding Best's Financial Strength Ratings - interactive basis. In A Best's FSR can be assigned to an insurance company on an interactive or non both cases, the rating scale and descriptors are: Secure Vulnerable (Superior) B, B - (Fair) A++, A+ - (Excellent) C++, C+ (Marginal) A, A (Good) C, C - (Weak) B++, B+ D (Poor) (Under Regulatory Supervision) E F (In Liquidation) S (Suspended) Rating Modifiers may be assigned to Financial Strength Ratings. Modifier Descriptor Definition u Under Indicates the rating may change in the near term, typically within six Review months. Generally is event driven, with positive, negative or developing implications. Public Data Indicates rating assigned to insurer that chose not to participate in A.M. pd Best's interactive rating process (discontinued in 2010). Syndicate Indicates rating assigned to a Lloyd's syndicate. s - Ratings from A to C also may be enhanced with a "++" (double plus), "+" (plus) or " " (minus) to indicate whether credit quality is near the top or bottom of a category. to an interactive FSR to indicate its potential direction over an intermediate is assigned An Outlook term, generally defined as 12 to 36 months. An Outlook can be: Outlook Definition Positive Indicates possible rating upgrade due to favourable financial/market trends relative to the current rating level. unfavourable financial/market trends Negative Indicates possible rating downgrade due to relative to the current rating level. Stable Indicates low likelihood of a rating change due to stable financial/market trends. To enhance the usefulness of ratings, A.M. Best assigns each rated (A++ through D) insurance company a Financial Size Category (FSC). The FSC is based on adjusted policy holders' surplus (PHS) and is designed to provide a convenient indicator of the size of a company in terms of its statutory surplus and related accounts. Many insurance buyers only want to consider buying insurance coverage from companies that they believe have sufficient financial capacity to provide the necessary policy limits to insure their risks. Although companies utilize reinsurance to reduce their net retention on the policy limits they underwrite, many buyers still feel more comfortable buying from companies perceived to have greater financial capacity.

2 Financial Size Category Adj. PHS ($ Millions) Adj. PHS ($ Millions) Class Class Less than 1 IX I 250 to 500 II 1 to 2 X 500 to 750 2 to 5 XI 750 to 1,000 III IV 5 to 10 XII 1,000 to 1,250 V XIII 1,250 to 1,500 10 to 25 VI 25 to 50 XIV 1,500 to 2,000 VII 50 to 100 XV 2,000 or greater VIII 100 to 250 Not Rated Designation The Not Rated (NR) designation is assigned to companies that are not rated by A.M. Best.

Related documents

Implementation Handbook For The Convention On The Rights Of The Child

Implementation Handbook For The Convention On The Rights Of The Child

IMPLEMENTATION HANDBOOK FOR THE CONVENTION ON THE RIGHTS OF THE CHILD FULLY REVISED THIRD EDITION IMPLEMENTATION HANDBOOK IMPLEMENTATION HANDBOOK FOR THE CONVENTION ON THE FOR THE CONVENTION ON THE RI...

More info »
WEF GlobalInformationTechnology Report 2014

WEF GlobalInformationTechnology Report 2014

Insight Report The Global Information Technology Report 2014 Rewards and Risks of Big Data Beñat Bilbao-Osorio, Soumitra Dutta, and Bruno Lanvin, Editors

More info »
Best Practices For Legal Education

Best Practices For Legal Education

Best Practices for Legal Education A Vision and A Road Map Roy Stuckey and Others Foreword by Robert MacCrate, Esq.

More info »
Building Excellent Schools Today (BEST) Annual Report

Building Excellent Schools Today (BEST) Annual Report

Building Excellent Schools Today (BEST) Annual Report Submitted to: Senate Education Committee Senate Finance Committee House Education Committee House Finance Committee Capital Development Committee ...

More info »
AndersBehringBreivikManifesto

AndersBehringBreivikManifesto

2011 , London – By Andrew Berwick

More info »
Best Available Techniques for Preventing and Controlling Industrial Pollution

Best Available Techniques for Preventing and Controlling Industrial Pollution

Best Av AilABle techniques for Preventing And controlling industriAl Pollution Activity 2: Approaches to establishing Best Available t echniques (BA t) Around the World

More info »
Speech Language Services in Arizona Schools: Guidelines for Best Practice

Speech Language Services in Arizona Schools: Guidelines for Best Practice

Arizona Department of Education , Superintendent of Public Instruction Kathy Hoffman Exceptional S tudent S ervices Arizona Technical Assistance System (AZ -TAS) Speech -Language Services i n A rizona...

More info »
Little Women

Little Women

Little Women By Louisa May Alcott

More info »
Microsoft Word   A) Division 245.docx

Microsoft Word A) Division 245.docx

tables Attachment Division 245, including A: Nov. 15-16, 2018, EQC meeting 1 of 121 Page Division 245 CLEANER AIR OREGON 340-245-0005 Purpose and Overview (1) This statement of purpose and overview is...

More info »
WEF GGGR 2017

WEF GGGR 2017

Insight Report The Global Gender Gap Report 2 017

More info »
Microsoft Word   guidelinesforbestpractice2001.doc

Microsoft Word guidelinesforbestpractice2001.doc

Guidelines for Best Practice in Child and Adolescent Mental Health Services Pennsylvania Department of Public Welfare Office of Mental Health and Substance Abuse Services Bureau of Children’s Behavior...

More info »
Numerical Recipes

Numerical Recipes

Sample page from NUMERICAL RECIPES IN C: THE ART OF SCIENTIFIC COMPUTING (ISBN 0-521-43108-5) Permission is granted for internet users to make one paper copy for their own personal use. Further reprod...

More info »
republic

republic

The Republic By Plato http://www.idph.net 18 de maio de 2002

More info »
WaterSense at Work: Best Management Practices for Commercial and Institutional Facilities

WaterSense at Work: Best Management Practices for Commercial and Institutional Facilities

WaterSense at Work Best Management Practices for Commercial and Institutional Facilities

More info »
The Best of Charlie Munger 1994 2011

The Best of Charlie Munger 1994 2011

The Best of Charlie Munger: 1994-2011 A collection of speeches, essays, and Wesco annual meeting notes

More info »
networks-book

networks-book

Networks, Crowds, and Markets: Reasoning about a Highly Connected World David Easley Jon Kleinberg Dept. of Economics Dept. of Computer Science Cornell University Cornell University Cambridge Universi...

More info »
meinkampf

meinkampf

Mein Kampf Adolf Hitler Translated into English by James Murphy

More info »
Computer Vision: Algorithms and Applications

Computer Vision: Algorithms and Applications

Computer Vision: Algorithms and Applications Richard Szeliski September 3, 2010 draft c © 2010 Springer This electronic draft is for non-commercial personal use only, and may not be posted or re-distr...

More info »
Essentials

Essentials

Essentials of Metaheuristics A Set of Undergraduate Lecture Notes by Sean Luke Department of Computer Science George Mason University Second Edition Online Version 2.2 October, 2015 The Mona Lisa, est...

More info »