AM Best Rating

AM Best is the rating agency built specifically for insurance — founded 1899, and still the only major agency whose entire business is judging insurers' ability to pay claims. Its Financial Strength Rating scale runs A++ and A+ (Superior), A and A− (Excellent), B++ and B+ (Good), then descends through Fair, Marginal, and worse. Because AM Best rates nearly every insurer that matters (thousands, versus the subset covered by S&P or Moody's), it's the rating you can always find.

What goes into the grade: balance-sheet strength (the anchor — capital adequacy via their BCAR model, reserve quality, reinsurance), operating performance, business profile, and enterprise risk management. Ratings get formally reviewed at least annually, and the accompanying outlook (stable, positive, negative) telegraphs likely direction.

Reading it for life insurance decisions: A− or better is the standard floor for any policy; for Whole Life Insurance you'll fund for decades and borrow against through Infinite Banking, practitioners generally want A+ or A++ — the tier where Penn Mutual, MassMutual, New York Life, and Guardian live. The grade compression at the top is why the Comdex Score exists: dozens of companies share "A," and the composite percentile spreads them back out. Use AM Best as the floor test, Comdex as the ranking, and the Dividend (Life Insurance) history plus illustrations as the decision.

Worth checking even after purchase: ratings move. A downgrade below A− on a company holding your Cash Value is a signal to review options (see 1035 Exchange — though strength problems usually announce themselves years ahead in outlook changes first). And remember the scope: AM Best grades claims-paying ability, not product generosity, agent quality, or whether the policy design serves your strategy. Strong company, wrong design is still the more common way to lose.