Long Term Care Insurance Company Ratings

Selecting the right insurance company is an important financial decision. One important consideration is the financial strength of the insurer. If the company cannot pay future claims or benefits, other considerations become unimportant. Financial strength ratings represent an analysis of a wide variety of risks that could affect an insurer's long-term survival. Insurance companies can fail or cease to operate due to inadequate financial capabilities, competitive forces, or changing fundamentals in their marketplaces.

Company Rating Comparisons

Company	AM Best	Moody	Standard & Poor's	Fitch
Aegon	N/A	Aa3	N/A	AA
Amex	N/A	N/A	N/A	N/A
CNA**	A	A2	AA-	A
GE	A+	Aa2	N/A	AA
John Hancock	A++	Aa2	AAA	AA+
Metlife	A+	Aa2	AA	AA
New York Life	A++	AA1	AAA	AA+
Prudential	A	A1	AA-	A+
State Farm	A++	Aa1	AA+	AA
UnumProvident	A-	A3	A-	A-

N/A = not applicable
** = Ratings for CNA subsidiary, Continental Assurance Company.

Some of the most common ratings agencies are Standard & Poor's, A. M. Best Company, FitchRatings, and Moody's Investors Service. Each company has its own evaluative criteria, so their ratings are not all equivalent, though they may appear to be similar, or even the same. The following is a chart of the ratings assigned by these companies and what the ratings mean.

A.M.Best Company
Standard & Poor's
Moody's Investors Services
Fitch

A.M. Best Company

This rating service is perhaps the best known of all the insurance rating companies. It publishes over 50 different information products about insurance companies and the insurance industry. The following table describes the A.M. Best rating system.

COMPANY OUTLOOK	RATING	DESCRIPTION
Secure	A++ and A+ (Superior)	The company has demonstrated superior overall performance and has a very strong ability to meet its obligations to policyholders over a long period of time.
	A and A- (Excellent)	The company has demonstrated excellent overall performance and has a strong ability to meet its obligations to policyholders over a long period of time.
	B++ and B+ (Very Good)	The company has demonstrated very good overall performance and has a good ability to meet its obligations to policyholders over a long period of time.
Vulnerable	B and B- (Adequate)	The company has an adequate overall performance and can meet its obligations to policyholders, but may be vulnerable to unfavorable changes in underwriting or economic conditions.
	C++ and C+ (Fair)	The company has demonstrated fair overall performance and can meet its current obligations to policyholders, but is vulnerable to unfavorable changes in underwriting or economic conditions.
	C and C- (Marginal)	The company has demonstrated marginal overall performance. It can meet its current obligations to policyholders, but it is very vulnerable to unfavorable changes in underwriting or economic conditions.
	D (Very Vulnerable)	The company has demonstrated poor overall performance. The company can meet its obligations to policyholders, but is extremely vulnerable to unfavorable changes in underwriting or economic conditions.
	E (Under State Supervision)	The company is under state insurance regulatory authority supervision, control or restraint, such as conservatorship or rehabilitation, but not including liquidation. This rating may be assigned if the company is under a cease and desist order issued by a state regulator other than from its state of domicile.
	F (In Liquidation)	The company has been placed under an order of liquidation by a court of law, or its owners have voluntarily agreed to liquidate. Companies that voluntarily liquidate or dissolve their charters are generally not insolvent.

Standard & Poor's

This rating service rates the claims-paying ability of over 300 insurance organizations worldwide, and monitors public data on another 2,000 U.S. companies.

COMPANY OUTLOOK	RATING	DESCRIPTION
Secure	AAA	Superior financial security on an absolute and relative basis. Capacity to meet policyholder obligations is overwhelming under a variety of economic and underwriting conditions.
	AA	Excellent financial security. Capacity to meet policyholder obligations is strong under a variety of economic and underwriting conditions.
	A	Good financial security, but capacity to meet policyholder obligations is somewhat susceptible to adverse economic and underwriting conditions.
	BBB	Adequate financial security, but capacity to meet policyholder obligations is susceptible to adverse economic and underwriting conditions.
Vulnerable	BB	Financial security may be adequate, but capacity to meet policyholder obligations, particularly with respect to long-term or "long-tail" policies, is vulnerable to adverse economic and underwriting conditions.
	B	Vulnerable financial security. Currently able to meet policyholder obligations, but capacity to meet policyholder obligations is particularly vulnerable to adverse economic and underwriting conditions.
	CCC	Extremely vulnerable financial security. Continued capacity to meet policyholder obligations is highly questionable unless favorable economic and underwriting conditions prevail.
	NR	Not Rated. The insurer is not rated by Standard & Poor's.
	R	Regulatory action. As of the date indicated, the insurer is under supervision of insurance regulators following rehabilitation, receivership, liquidation, or any other action that reflects regulatory concern about the insurer's financial condition. Information on this status is provided by the National Association of Insurance Commissioners and other regulatory bodies. Although believed to be accurate, this information is not guaranteed. The "R" rating does not apply to insurers subject only to non financial actions such as market conduct violations.
Plus (+) or Minus (-) Sign		The ratings from "AA" to "B" may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories. Standard & Poor's ratings and other assessments of credit worthiness and financial strength are not a recommendation to purchase or discontinue any policy or contract issues by an insurer or to buy, hold or sell any security issued by an insurer. In addition, neither a rating nor an assessment is a guaranty of an insurer's financial strength.

Moody's Investor Services

This rating service rates the claims-paying ability of over 300 insurance organizations worldwide, and monitors public data on another 2,000 U.S. companies.

COMPANY OUTLOOK	RATING	DESCRIPTION
Strong	Aaa	Exceptional financial security. While the financial strength of these companies is likely to change, such changes as can be visualized are most unlikely to impair their fundamentally strong position.
	Aa	Excellent financial security, together with the Aaa group, they constitute what are generally known as high-grade companies. They are rated lower than Aaa companies because long-term risks appear somewhat larger.
	A	Good financial security. However, elements may be present which suggest a susceptibility to impairment sometime in their future.
	Baa	Adequate financial security. However, certain protective elements may be lacking or may be characteristically unreliable over any great length of time.
Weak	Ba	Questionable financial security. Often the ability of these companies to meet policyholder obligations may be very moderate and thereby not well safeguarded in the future.
	B	Poor financial security. Assurance of punctual payment of policyholder obligations over any long period of time is small.
	Caa	Very poor financial security. They may be in default on their policyholder obligations or there may be present elements of danger with respect to punctual payment of policyholder obligations claims.
	Ca	Extremely poor financial security. Such companies are often in default on their policyholder obligations or have other marked shortcomings.
	C	The lowest rated class of insurance company; can be regarded as having extremely poor prospects of ever offering financial security.
1, 2, 3 Modifiers		These modifiers can be used for each generic rating category from Aa to B. 1 indicates that the insurance company ranks in the higher end of its generic rating category. 2 indicates a mid-range ranking. 3 indicates that the company ranks in the lower end of its generic category.

Fitch

Fitch is an international rating agency; it rates companies in 75 countries and is your best best for checking the ratings of foreign insurers.

COMPANY OUTLOOK	RATING	DESCRIPTION
Secure	AAA	Superior financial security on an absolute and relative basis. Capacity to meet policyholder obligations is overwhelming under a variety of economic and underwriting conditions.
	AA	Excellent financial security. Capacity to meet policyholder obligations is strong under a variety of economic and underwriting conditions.
	A	Good financial security, but capacity to meet policyholder obligations is somewhat susceptible to adverse economic and underwriting conditions.
	BBB	Adequate financial security, but capacity to meet policyholder obligations is susceptible to adverse economic and underwriting conditions.
Vulnerable	BB	Financial security may be adequate, but capacity to meet policyholder obligations, particularly with respect to long-term or "long-tail" policies, is vulnerable to adverse economic and underwriting conditions.
	B	Vulnerable financial security. Currently able to meet policyholder obligations, but capacity to meet policyholder obligations is particularly vulnerable to adverse economic and underwriting conditions.
	CCC	Extremely vulnerable financial security. Continued capacity to meet policyholder obligations is highly questionable unless favorable economic and underwriting conditions prevail.
Distressed	CC	The company most likely does not have the capacity to meet policyholder obligations, particularly with respect to long-term or "long-tail" policies, is extremely vulnerable to adverse economic and underwriting conditions.
	C	The demise of the company is only a metter of time. The company will not be able to meet meet policyholder obligations in the very near future
	DDD, DD, & D	Currently Unable to meet policyholder obligations.

Texas license # 1270417