Homeowners Insurance Company Ratings

Mary Gormandy White
How stable is your homeowners insurance company?
How stable is your homeowners insurance company?

Before selecting a provider, it's important to investigate homeowners insurance company ratings.

Consider Homeowners Insurance Company Ratings

It's important to shop around before purchasing a homeowners insurance policy. There are many different insurance companies and a variety of different policies. Premiums may vary greatly from one policy to another and from one company to another. Price is an important consideration, but it should not be the only concern when selecting homeowners insurance coverage. A bargain insurance policy won't do you any good if the insurance company is not able to honor the terms of the coverage you purchase in the event you need to file a claim.

While price is certainly an important factor when choosing an insurance policy for your home and belongings, it's also essential to select a provider that is financially strong and that has a solid track record of success. That's why it's essential to look at homeowners insurance company ratings when comparing insurance providers. This type of data provides insight into how financially stable an insurance company is, which can impact whether or not the organization will be able to pay claims that you and other policyholders might have to file.

Agencies That Rate Insurance Companies

There are five independent agencies that provide financial security ratings for insurance companies. These agencies are not affiliated with any particular insurance company, and so are able to provide unbiased information about each provider from the perspective of an independent third party. They use a rating scale to compile information about each the financial soundness of each insurance company.

The independent agencies that rate insurance companies include:

  1. A.M. Best - Visit the A.M. Best website to look up this agency's rating of any insurance company you are thinking about choosing.
  2. Fitch - A complete list of insurance company ratings is available on FitchRatings.com.
  3. Moody's - Information about insurance company ratings, the firm's watch list, and more is available at Moodys.com. You'll need to register to gain access to detailed information.
  4. Standard & Poor's - Visit the S & P website for detailed ratings information about more than 3,000 insurance companies.
  5. Weiss - You can view a list of the strongest and weakest U.S. insurance company's on the Weiss website at no charge. You can also purchase detailed rating reports for specific insurance companies.

Making Wise Homeowners Insurance Choices

When comparing different options for homeowners insurance, it's a good idea to thoroughly research the company you are considering purchasing the policy from in addition to making sure you clearly understand the terms and conditions of the policy. Looking at homeowners insurance company ratings is a big part of determining just how secure the companies you are considering doing business with are.

Don't rely solely on the rating information highlighted in each insurance company's literature. It stands to reason that each company will highlight the rating information that portrays the organization in the most positive light in its marketing materials. Since there are five different ratings companies, you don't have to rely on a single rating to make a decision.

Because each company uses a different rating scale, there can be significant variation in how an insurance company looks in terms of financial stability based on which rating you are looking at. That's why it's a good idea to look up multiple ratings for the insurance providers you're considering. It is certainly in your best interest to make sure you have access to all relevant information before making a choice.

Homeowners Insurance Company Ratings