• Auto Insurance Company Ratings: Understand What They Mean

    Buying an insurance policy is a crucial financial decision when it comes to buy the car, and auto insurance company ratings help with that decision. There are several companies who sell the insurance and protect the assets of their clients. Some insurance companies check the individual’s credit history, their assets & liabilities. Based on information collected by the insurance companies, they give a quotation to the clients. It is better to buy and protect the assets such as car, house, motorboat, bike (motorcycle) from same insurance company because clients get very good discounts.

    Most Commonly Used Ratings:

    AAA

    AAA ranking is the highest credit grade that can be achieved by the insurance company. This ranking shows the competency of a company in paying claims. An insurance company with an AAA ranking also indicates that they have flexible plans. 

    Example: Progressive, State Farm, Geico and etc.

    BBB

    This ranking helps a customer to understand that there are no financial risks involved with a certain company. This shows that the insurance company can pay efficiently whenever there is a need. Apart from this it also shows the fairness of a company.

    Example: Cure

    CC

    CC rating is the third rank given to an insurance company where the financial risks are more obvious. This is a weak rating implying that the company is financially inadequate to pay of the claims in time and might fail to operate in competitive environment.  It is better to avoid such insurance companies.

    R

    R stands for regulatory action which indicates that the insurer is under surveillance of a supervising body to keep a watch on its liquidation, receivership and other actions that affect its financial credibility.

    NR

    Another ranking called NR shows that the company is not rated. It is not recognized under any regulatory body and does not have any negative or positive implications. Both the rankings are an alarming sign to the potential customers to avoid such companies and invest elsewhere.

    Take the time to learn about auto insurance company ratings to understand how your insurance company works and how they rank in the auto insurance industry. This can also give a clue into how your premiums are decided and the types of coverage you are being offered.