Long Term Care Insurance Association Launches Provider Ratings
There are many things to consider before you purchase long term care insurance such as what your needs are, what is the right policy type for your personal situation and how much coverage costs. Another very important thing to consider is the rating of the company that you purchase your policy from notes Jesse Slome, executive director of the American Association for Long Term Care Insurance, the industry's trade organization.
"The present economic environment has shown the importance of selecting a sound company to work with," Slome explains. "One of the things you should consider is the rating of the insurance company being recommended by your health insurance or financial professional."
Slome notes that several leading independent companies rate insurers that offer long term care insurance policies. "While these ratings do not offer a crystal ball look into the future they can help you make better decisions regarding this important protection," Slome says. Ratings are based on current and historical information available. "That is the best any of us can do to manage risk."
To help consumers seeking ratings information, the LTC insurance Association launched an online resource which includes the latest ratings for A.M. Best, Standard & Poor's and Moody's, three of the leading firms. "Each is an independent firm that looks at an insurance companies' financial strength on a regular basis," Slome notes.
"Each rating company uses a slightly different rating scale but the general idea is somewhat like a grading scale you would expect to see in school," he explains. A grade of A++ or AAA is the best possible rating ranging on down to F -- which is generally the lowest. It is the middle and low of these scales that differ slightly with each rating system. The different measurement scales and their definitions are available on each of the rating company's website.
A.M. Best is one of the better known of the insurance rating companies. The A.M. Best rating scale ranges from A++ (Superior) to F (In liquidation). Standard and Poor's rates the claims-paying ability of over 300 insurance organizations worldwide. Their ratings scale ranges from AAA (Superior) to CCC (Extremely vulnerable). Moody's ratings reflect the financial strength of investment vehicles and institutions including insurance companies.
"It is important to ask your insurance or financial professional for the latest rating of the company he or she is recommending," Slome notes. "Ask for something with written proof and make sure it includes a date when the company was most recently rated. It doesn't hurt to compare with the latest data online to make certain there have been no changes." A listing of ratings for leading long term care insurers can be found on the American Association for Long Term Care Insurance's website.
The American Association for Long Term Care Insurance is the national trade organization providing consumers with relevant and current information. The Association does not sell insurance products but works with several thousand insurance and financial professionals nationwide. Consumers should visit the Association's LTC Consumer Information Center to access information including insurance company ratings.
Written by Jesse Slome