Reviewing a Company's Financial Ratings, The Comdex Ranking.
When purchasing a disability insurance policy, the financial strength of the company can be an important factor in your decision. You are ultimately investing in a company to protect you if and when a disability strikes. Since a policy is designed to be in force for many years, a company’s financial strength can be a good indicator of whether the policy you are buying will be there as expected.
There are many rating agencies that have been established to assess the ability of a company to meet its ongoing and long term financial obligations. But what do all those letters and numbers mean?
There are currently four main companies that assess the financial stability of an insurance carrier; A.M. Best Company, Standard & Poor’s, Fitch and Moody’s. Unfortunately, they do not utilize a common scale. That means, four companies, four different scales.
The amount of time it could take to research each company, their methodology and ratings system could be endless. If only there were a system in place which did all the hard work for you? Let’s meet the Comdex Ranking!
Vital Signs Comdex Ranking is a composite of all the ratings that a company has received. The Comdex ranks the companies on a scale of 1 to 100, in relation to other companies that have been rated by the rating agencies. Simply speaking, the higher the number, the stronger a company’s overall financial outlook. In order to be given a Comdex ranking, an insurance company must be rated by at least 2 of the major ratings companies.
|Insurance Company||Comdex Rating|
|Northwestern Mutual Life Insurance Company||100|
|Berkshire Life Insurance Company of America||99|
|The Guardian Life Insurance Company of America||98|
|Massachusetts Mutual Life Insurance Company||98|
|Metropolitan Life Insurance Company||94|
|Principal Life Insurance Company||90|
|Standard Life Insurance Company||82|
Please consult with your financial advisor for complete details concerning the ratings stated above. Some of the ratings reflect the performance of the parent company and/or other entities related to the issuing insurer.
According to most experts, the difference between a company with a Comdex of 98 and a 94 is the difference between choosing a company that is “extremely safe” and “safe.”
A company’s financial strength is an important component when choosing a disability insurance policy. The Comdex Ranking has now made this even easier by compiling the ratings of the different carriers into one easy to understand number. With Comdex and a knowledgeable insurance agent, you are well on your way to protecting your income.