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A.M. Best

The A.M. Best Company provides evaluations of the financial and operating performance of virtually all insurance companies licensed to do business in the U.S. The evaluation process includes quantitative tests in three critical areas; profitability, leverage and liquidity. The process also includes an on-going working relationship with the insurer's management.

A++, A+
Superior
. Assigned to compaies which have, on balance, superior financial strength, operating performance and market profile when compared to the standards established by the A.M. Best Company. These companies have a very strong ability to meet their ongoing obligations to policyholders.

A, A-
Excellent. Assigned to companies which have, on balance, excellent financial strength, operating performance and market profile when compared to the standards established by the A.M. Best Company. These compaies have a strong ability to meet their ongoing obligations to policyholders.

B++, B+
Very Good
. Assigned to companies which have, on balance, very good financial strength, operationg performance and market profile when compared to the standards established by the A.M. Best Company. These companies have a good ability to meet their ongoing obligations to policyholders.

B, B-
Fair
. Assigned to companies which have, on balance, fair financial strength, operating performance and market profile when compared to the standards established by the A.M. Best Company. These companies have a good ability to meet their current obligations to policyholders, but their financial strength is vulnerable to adverse changes in underwriting and economic conditions.

C++, C+
Marginal
. Assigned to companies which have, on balance, marginal financial strength, operating performance and market profile when compared to the standards established by the A.M. Best Company. These companies have an ability to meet their current obligations to policyholders, but their financial strength is vulnerable to adverse changes in underwriting and economic conditions.

C, C-
Weak.
Assigned to companies which have, on balance, weak financial strength, operation performance and market profile when compared to the standards established by the A.M. Best Company. These companies have an ability to meet their current obligations to policyholders, but their financial strength is very vulnerable to adverse changes in underwriting and economic conditions.

D
Poor
. Assigned to companies which have, on balance, poor financial strength, operationg performance and market profile when compared to the standards established by the A.M. Best Company. These companies may not have an ability to meet their current obligations to policyholders, but their financial strength is extremely vulnerable to adverse changes in underwriting and economic conditions.

E
Under Regulatory Supervision
. Assigned to companies which have been placed by an insurance regulatory authority under a significant form of supervision, control or restraint, such as conservatorship or rehabilitation, but does not include liquidation. It may also be assigned to companies issued cease and desist orders issued by regulators outside their home state or country.

F
In liquidation
. Assigned to companies which have been placed under an order of liquidation by a court of law or whose owners have voluntarily agreed to liquidate the company.
Note: Companies that voluntarily liquidate or dissolve their charters are generally not insolvent.

"Not Rated" Categories
The "Not Rated" Categories identify why a company is not eligible for a Best's Rating.

NR-1
Insufficient Data. Assigned predominantly to small companies for which A.M. Best does not have sufficient financial information required to assign a rating opinion. The information contained in these limited reports is obtained from several resources, which include the individual companies and the National Association of Insurance Commissioners (NAIC). The data received from the NAIC, in some cases, is prior to the completion of their cross checking and validation process.

NR-2
Insufficient Size and/or Operation Experience. Assigned to companies that do not meet A.M. Best's minimum size and/or operating experience requirements.

NR-3
Rating Procedure Inapplicable. Assigned to companies that are not rated by A.M. Best, because our normal rating procedures do not apply due to their unique or unusual business features.

NR-4
Company Request. Assigned to companies that request that their rating not be published.

NR-5
Not Formally Followed. Assigned to companies that are not formally evaluated for the purposes of assigning a rating opinion.

S
Rating Suspended

Financial Performance Rating (FPR)
The FPR measures the financial strength of small or new companies (NR-2) not eligible for a Best's Rating and is based on the following numerical scale.

Secure Ratings
9          Very Strong
7, 8      Strong
5, 6      Good

Vulnerable Ratings
4          Fair
3          Marginal
2          Weak
1          Poor

For further information, contact A.M. Best Company at Ambest Roadk, Oldwick, NJ 08858  (908)439-2200.



Last Updated: 9/23/2012 10:05:00 PM