Am Best Rating Insurance Companies - When making a big purchase, at some point in the process we've all wondered, "Where can I get unbiased advice?" As an Account Manager at Protexure Insurance Agency, my job is to help attorneys find insurance carriers and policies that fit their needs. While I believe the Attorney Protexure program is a great option for solo attorneys and small law firms, I also understand that we may not be right for everyone. Also, as a customer myself, I understand the frustration of having account managers, sales associates, etc., just try to push the store instead of listening to my needs and helping me find the best solution. . Sometimes, we just want a third-party resource to help us weigh our options, right? I am often asked for reliable sources for attorneys to review insurance carriers and know who is the best. Unfortunately, there is no clear answer as to who is the best. As in general, it depends on personal preference and opinion. However, when evaluating an insurance carrier, attorneys should not rely on the potentially biased opinions of attorneys, agents, or even the insurance carrier itself. There is an unbiased source for rating insurance carriers called AM Best ratings. Unless you're in the insurance industry or have spent a lot of time researching insurance carriers, you're probably asking, "What's AM Best News?" And again, "Why should this review help me decide which carrier to choose?" Throughout this article, I will explore why AM Best's rating is important to consider when choosing legal malpractice insurance options. I'll break down each value and what it represents, as well as recommend which values are best suited for your company. What do AM Companies do best? AM Best Company reports on the financial strength and operational performance of more than 16,000 insurance companies. These ratings are there to help customers understand the stability and history of the operator. AM Best rating rates the financial strength of insurance carriers on a scale from D to A++, with D being the lowest grade and A++ being the highest and most financially sound carrier. Like the Better Business Bureau, AM Best is a credit rating company based on its ability to pay claims, debts and other financial obligations. In addition to ratings, AM Best provides commentary, research and analysis to provide further insight. AM Best provides free insurance carrier quotes in an effort to support consumers, insurance carriers and the insured as a whole. Over the years, AM Best has become one of the most trusted sources for insurance carrier information. Attorneys, and all insurance consumers, use AM Best ratings to make unbiased decisions about which insurance providers to partner with. How is the best AM value determined? Through a rigorous process, each insurance company is examined by AM Best's advisory board and rated in four different categories: Financial Strength Rating (FSR) Best Broadcast Credit Rating (ICR) Best Issue Rating (IR) National Standard Rating (NSR) For purposes In this article, we will focus on the Best Financial Strength Ratio (FSR). While other values should be mentioned, they do not have a significant impact on consumers. Throughout the insurance industry you will find that insurance carriers issue AM Best rates. When prices are listed on insurance company websites or promotional materials, they refer to the Best Financial Strength Rating. Below is a breakdown of AM Best's Financial Strength Ratio (FSR). The rating/grade here is determined based on the insurer's ability to meet its obligations and financial strength. According to the AM Best website, the rating is as follows: AM Best Company. (2020). AM Best Consumer Insurance Information Center. Retrieved May 26, 2020, from http://consumers.ambest.com/content.aspx?rec=261606. How to Use AM When Choosing an Insurance Carrier In the insurance industry, the AM Best rating is taken very seriously. Most insurance consumers consider the AM Best rating when deciding on an insurance carrier for a malpractice insurance policy. The AM Best rating reflects the carrier's stability, financial strength, and continued ability to meet coverage obligations to customers. As consumers, many of us do our own research to determine what to buy. Insurance is like any other purchase, but there are many factors to consider, third party reviews should be considered. For example, if you are looking to buy a car, you will most likely be interested in the make, model, color and other features. But, ultimately, we want to know, will this car get me from point A to point B safely? If you're going to make a significant investment in a car, you want to make sure you and your loved ones are protected. To determine this, you may want to check the IIH Safety Rating. AM Best Rating works the same way. This assessment provides you, the client, with a reliable, third-party assessment of how well the law firm will be protected by the insurance company. Like other rating services, AM Best has made it easy for you to rate insurance carriers. Simply visit the AM Best website, enter the insurance company you are interested in and AM Best will generate a quote based on the table shown above. How an AM Best rating affects your law firm An AM Best rating can have a major impact on your law practice. Whether the effect is positive or negative is up to you. Choosing an insurance carrier with an AM Best rating (A or above) will ensure that any potential claims you face will be handled by a healthy and stable insurance provider. In the event of a claim, an insurance provider with a good AM rating can be considered to have coverage and financial obligations at their discretion. On the other hand, if a law firm chooses a malpractice insurance provider with a less than one-star AM Best rating, handling claims can be a difficult process. In the table above, the lower ratings (B++ and below) are more volatile and less financially stable. Insurance is meant to be a financial safety net that protects you from the unknown. As a lawyer, you spend years on an insurance program for financial security should the worst-case scenario occur. However, if you are with a low-cost insurance carrier that cannot pay your insurance claim, you will be responsible for covering the cost of the lawsuit. In addition, insurance carriers with low rates are at risk of closing their doors. If this happens, what is your policy? While there is a safety net for this exact scenario, there is a risk that your coverage is limited despite the amount you have invested. Insurance is an investment that should be researched before committing to a carrier. The insurance company you hire must be trusted to handle your business and maintain the contract. The Best AM Rates for Your Law Firm? When it comes to carrier evaluation based on AM Best ratings, AM Best Company does not provide guidelines on what ratings are reasonable or optimal. In order to remain unbiased and neutral, they only give ratings, and we have to interpret them. From our experience, we recommend choosing an insurance carrier with at least an A rating or higher. Insurance carriers rated above A to A, especially for a long time, will provide customers with excellent service, reliable coverage and fast claims handling at fair prices. Whether you feel comfortable choosing a carrier below the A rating will depend on your risk tolerance. However, the good news is, great value insurance operators are not hard to come by, There are many legal malpractice operators to choose from with a rating of A and above. When choosing a valid fault selector, evaluating the value of AM Best is an important first step. Once you've compiled a list of carriers that meet your desired criteria, it's time to explore the other factors that make a good insurance carrier.
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