Choosing A Company
|
| When buying a life insurance product, you should use the same
care you would when making any sizable purchase. Ask your agent for financial
information about the company you are considering. |
| There are a number of commercial insurance rating services
that rate the claims-paying ability and financial strength of insurance
companies. These published ratings can be found in public and business
libraries. Rating firms consider several important factors when developing a
rating, including profitability, capital adequacy, liquidity, investment risk
and management quality. |
| While all major rating services analyze each of these areas,
analytical methods vary and different services do not weigh all factors the
same way. |
| When choosing a rating service, find out whether its company
evaluations are comprehensive and what is being measured. Be sure you
understand what the various services measure and what the different ratings
mean. Also, check the rating date to be sure the information is current.
Ratings provide a snapshot of a company's financial condition, companies can be
upgraded -- or downgraded -- from one report to the next. |
| Keep in mind that not all companies are rated by every
service. Companies usually have to pay rating services for a comprehensive
review. A company's lack of a rating is not a poor reflection on that company;
it simply has not gone through the evaluation process with a particular
service. |
| Finally, remember that while ratings can be helpful, they are
only one factor, albeit a very important one, worth considering when choosing a
company. A company's reputation for service to customers is another factor you
should consider. |
