Do carrier ratings really matter?

September 28, 2022

In a word: Yes. They do. There are organizations that rate the financial condition of insurance companies, such as Demotech, Moody’s and S&P Global Ratings. However, AM Best is probably the most prominent.

AM Best uses letter ratings, ranging from “A” (which is considered the best), to “D” (which is considered poor). Typically, when a carrier is rated below a “D,” it is under some degree of regulatory supervision or in liquidation. When a carrier is assigned an “NR” rating, it is because it lacks operating experience or sufficient data, or the rating procedure is inapplicable because the carrier is too unique, or the carrier has declined its letter rating. Carriers with a rating of “B” or less are considered “vulnerable” and they need to be watched carefully.

Want more information? PIA Northeast members can access the following document: Carrier ratings: do they really matter?

The agent role and how PIA can help

Your clients trust you to place their coverage with carriers that will be there to honor their obligations. How can you meet this level of trust if you don’t know the financial condition of your markets? Knowing the ratings of your companies is simple.

If you want to stop worrying, sign up for PIA’s Company Rating Tracking Service—which is available exclusively to PIA members. Once you sign up for this service, you will receive an email from PIA when one of your represented carrier’s AM Best rating changes.

To participate, contact PIA’s Industry Resource Center by phone at (800) 424-4244 or by email with a listing of the carriers your agency represents. Please note: This alert is a product of PIA and is not affiliated with any service provided by AM Best.

It’s that time of year again …

If you are a PIA Northeast member, you should have received your PIA Company Representation Survey in the mail. The results from this survey help PIA to know which carriers you do business with to help us keep you informed about company activities that have a direct impact on your agency—such as an insurer insolvency, merger, or acquisition.

If you haven’t done so already, please take a few minutes to complete the survey and email it back to PIA’s Industry Resource Center or fax it to (888) 225-6935. If you didn’t receive your copy of the survey, email the Industry Resource Center to update your information. Don’t forget to put your name and your agency’s name at the top of the survey.

Shirley Albright, CPIA, CISR
PIA Northeast | + posts

Shirley Albright, CPIA, CISR, joined PIA in 1983 and has worked in many facets of the association over the years. In 1995, she was an integral part of establishing the Industry Resource Center to include the development of the software system to record and track all incoming and outgoing inquiries. She quickly moved from industry resource representative to assistant director and eventually to her current position as director. Currently, Shirley oversees the daily operations of the Industry Resource Center to include the triage of thousands of incoming member inquiries. Her other accomplishments include obtaining her New York state property/casualty broker’s license, CPIA and CISR designations.

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