To help determine an insurer's financial stability, you can check the safety ratings established by one of the many rating companies available.
Some of the most widely used rating companies are:
A.M. BEST - Assigns 15 different rating categories from A++ to F measuring a carrier's ability to meet their respective policyholder and other contractual obligations, and size categories ranging from I to IV.
DEMOTECH'S Financial Stability Ratings® (FSRs) are a leading indicator of the financial stability of a property and casualty insurer. Demotech's rating process provides an objective baseline for assessing solvency which in turn provides insight into changes in financial stability.
FITCH RATINGS - Rates from an investors and policyholder standpoint addressing concerns such as claims-paying abilities, financial fundamentals, details regarding capitalization, debt ratings, leverage, and asset quality.
MOODY'S - Examines an insurance company's financial ability to meet its obligations to its policyholders. Among the issues on which Moody's focuses is the management philosophy, the quality of its investment portfolio and its asset/liability structure. It features ratings from Aaa to C.
NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS - The NAIC’s Consumer Information Source (CIS) provides information about insurance companies you can use BEFORE purchasing insurance. You can access key information about insurance companies, including closed insurance complaints, licensing information and key financial data.
STANDARD & POORS - Provides a review of an insurance company's claims-paying ability.
WEISS RATINGS, INC. - Rates insurers according to General Accounting Principles. Unlike other major rating agencies, Weiss does not accept compensation from the companies it rates. The scale used is from A to F.