Ratings matter: Understanding the importance of industry ratings

Movies have them, so do cars, books and a plethora of other products and services. Ratings on products and services are easy to find and can be helpful to a buyer’s experience and product satisfaction.

The same goes for insurance and financial companies. They also receive ratings, but the process is vastly different from a consumer simply adding a star or a thumbs up to a website.

Industry ratings are vital; they help you select an insurance company that is financially strong. Not all insurance companies are highly rated, especially those in the emerging financial technology arena. As you consider new insurance carriers, it’s important to select a company that has strong financial ratings to ensure they can pay your member and customer claims.

Factors considered in agency ratings

There is much more to an insurance company than the price you pay for a policy. An insurance company rating indicates its solvency, financial strength and ability to pay policyholder claims. Ratings analysts consider these financial factors in their reviews:

• Financial strength and financial results
• Quality of investment portfolio
• Experience of management team
• Strong liquidity and capital positions
• Strong market presence in the markets the company competes
• Business performance, measured by sales, revenue, and earnings

In order to be rated, a company goes through a rigorous review and analysis of both its public and private information. Company leaders meet with ratings analysts, who ask questions and dig deeper into the business. Analysts then perform in-depth reviews, discuss findings with a ratings committee and finally deliver their rating in a forwardlooking analysis. Agency analysts continue to follow the company and have periodic check-ins to make sure the rating stays up to date.

Insurance ratings and agencies

Leading rating agencies include S&P Global, Moody’s, Fitch Ratings and A.M. Best. While not an agency, there is also a Comdex rating, which provides a composite ranking of an insurer’s ratings assigned by independent agencies, making it easier to compare a company across similar types of insurers.

Securian Financial’s superior ratings

Securian Financial is proud of its long history of strong ratings. Our insurance company subsidiaries, Minnesota Life Insurance Company, Securian Casualty Company and Securian Life Insurance Company, a New York authorized insurer, receive high ratings year after year. Current 2023 ratings are:

• A+ Superior - A.M. Best. 2nd highest of 16 ratings
• AA Very Strong – Fitch Ratings. 3rd highest of 19 ratings
• Aa3 Excellent – Moody’s Investor Service
• AA- S&P Global – 4th highest of 21 ratings
• Comdex ranking is 96, out of 100
• A Excellent - A.M. Best - Securian Casualty Company
• A Excellent - A.M. Best - Canadian Premier Life Insurance Company

We’re especially proud that Minnesota Life Insurance recently received recognition by A.M. Best, the nation’s oldest rating agency, with the “Best’s Review Standing the Test of Time” award for maintaining a Best Credit Rating of “A” or higher for 75 years.

Remember, ratings matter!