AM Best assigns ratings to insurance companies based on their financial strength and ability to meet ongoing obligations. A “B-” rating from AM Best signifies a fair ability to meet these obligations, ranking as the eighth-highest out of 13 possible ratings. A “C++” rating indicates a marginal ability, placing it ninth on the scale. AM Best’s ratings range from “A++” (highest) to “D” (lowest).
In comparison, S&P’s “A” rating denotes strong financial security characteristics for insurers. This is the third-highest rating out of nine categories, ranging from “AAA” to “D.” S&P utilizes plus (+) or minus (-) signs to indicate relative standing within a category, resulting in 21 distinct rating levels. An “A-” rating is the seventh-highest in this expanded scale.
Moody’s also uses an “A” rating to represent good financial security for insurance companies. Like S&P, this is the third-highest of nine categories, ranging from “Aaa” to “C.” Moody’s employs numerical modifiers (1-3) to signify ranking within each category, excluding “Aaa” and those below “Caa.” Consequently, an “A3” rating is the seventh-highest among Moody’s 21 rating levels.
Similarly, Fitch designates an “A” rating to insurers with a strong capacity to fulfill policyholder and contract obligations. This is the third-highest of nine categories, spanning from “AAA” to “C.” Fitch also uses plus (+) and minus (-) modifiers within categories, excluding “AAA” and those below “B.” An “A-” rating from Fitch represents the seventh-highest position out of 21.
Finally, HR Ratings provides ratings on a local scale. “HR1” is their highest short-term rating, indicating a high capacity for timely debt payment and low credit risk. “HR AA” is the second-highest long-term rating, signifying high credit quality and low credit risk even under adverse economic conditions. HR Ratings’ scales range from “HR1” to “HR D” for short-term and “HR AAA” to “HR D” for long-term ratings.
