What are the biggest insurance rating companies in the US and why do their ratings matter?

If you are a policyholder, you may have noticed ratings for your insurance provider, and these vary from three letters like “AAA” or “CCC”, or even a single letter like “A” or “C”. These ratings are critical, as these signify an insurance company’s financial strength and its ability to make good on its policies and contracts.  

That’s why it’s crucial that you are familiar with the top insurance rating companies in the USA. The ratings they give to insurance companies can guide you as to which of them are solvent and are able to fulfill claims. Read on to know more about how these insurance rating companies work and their impact on your business.  

The top insurance rating companies in the US 

What are the top insurance rating companies in North America? The list is comprised of four major agencies. They are:  

• A.M. Best 
• Fitch 
• Moody’s 
• Standard & Poor’s (S&P Global Ratings) 

1. A.M. Best 

Founded in 1899 by Alfred M. Best, A.M. Best is the most important rating company for the insurance industry, since this is the only global credit rating agency that is focused exclusively on insurance. A.M. Best assesses the creditworthiness of and reports on over 16,000 insurance companies all over the world.  

This insurance rating company provides independent ratings that are used to evaluate an insurer’s ability to meet their ongoing obligations to policyholders. These ratings can help consumers, investors, and professionals make informed decisions.  

A.M. Best methodology 

A.M. Best uses its own credit rating methodology, known as Best's Credit Rating Methodology (BCRM), which creates a comprehensive framework for evaluating insurance companies. This methodology uses a form involves a "building block" approach to develop Issuer Credit Ratings (ICR) through quantitative and qualitative evaluations of: 

• business profile 
• balance sheet strength 
• enterprise risk management 
• operational performance

In practice, the agency’s analysts would use applicable BCRM criteria and models when assessing insurance companies. The process then culminates in a committee decision to assign financial strength and appropriate credit ratings that reflect the insurer’s ability to meet obligations to policyholders.  

A.M. Best’s ratings range from A++ denoting Superior, to D, meaning Poor, with many ratings in-between to indicate subtler distinctions in financial capacity. Ratings are predictive, independent, and based on qualitative and quantitative data.  

The top 10 insurance companies according to A.M. Best in 2025 

Here are the top 10 insurers as rated by A.M. Best, from the highest to lowest credit ratings. Note that they are ranked by their total non-banking assets according to A.M. Best’s latest report, as of January 2025. These are the key players with the strongest financial strength and operating performance globally. 

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The top 10 P&C insurance companies in the US according to A.M. Best 

The table below reflects the latest data, which is net premiums written by P&C insurers in 2023. Ranking criteria are based on financial performance metrics, including their premiums written, a key indicator of an insurer’s market size and operational scale. Note that these 2023 metrics typically represent the latest full-year results for 2025 rankings, since insurance financial data is typically about a year behind for comprehensive data reporting and analysis.  

2. Fitch 

Fitch is recognized as one of the “Big Three” in major global credit rating agencies, alongside Moody’s and Standard & Poor’s. Founded in 1913, Fitch supplies forward-looking credit opinions to help assess the creditworthiness and likelihood of default of governments, corporations, financial institutions, and other entities.  

The agency uses a letter-grade rating scale from AAA (highest quality) to D (default) to help investors and market participants evaluate credit risk. Fitch works globally with its headquarters in New York and London. It’s known for its role in analyzing sovereign, corporate, and financial market debt.  

Fitch methodology 

Fitch uses the Insurer Financial Strength (IFS) rating system supported by the proprietary Prism Capital Model, which is a risk-based capital model. Their methodology evaluates:  

• business profile (business risk profile, competitive position, diversification) 

• capitalization and leverage 

• financial performance and ratings 

• operating environment and risk management capabilities  

Fitch scores main credit factors, weighing them using a three-level influence scale (moderate, lower, higher). Fitch’s approach integrates capital adequacy and risk exposure while allowing for geographic and market-specific considerations.  

It’s important to note that Fitch does not officially publish a “top 10 companies” list based purely on credit rankings or their ranking metrics. Fitch assigns credit ratings individually to companies based on their creditworthiness, rather than producing a list of ranked companies. 

3. Moody’s 

Moody’s Corporation is a leading American financial services company that specializes in risk analysis, credit ratings, and research. Founded by John Moody in 1909, Moody’s provides credit ratings via its subsidiary Moody’s Ratings, which assesses the creditworthiness of governments, companies, and debt securities all over the world. It uses a standardized ratings scale that ranges from Aaa (highest quality) to C (lowest quality).  

Moody’s other subsidiary, Moody’s Analytics, offers research, financial analysis software, and risk management tools. To this day, Moody’s plays a crucial role in global capital markets by assisting investors and institutions make informed decisions regarding credit risk. It remains as one of the “Big Three” credit ratings agencies alongside Fitch and S&P.  

Moody’s methodology 

For its methodology, Moody’s uses a scorecard-based approach to rate insurers. The company scores each credit factor on a seven-point scale ranging from Aaa to Caa or lower and computing a weighted average to derive the insurer’s Financial Strength Rating. Key components of their rating methodology include:  

• operating environment 

• business profile 

• financial profile, which includes capital adequacy, earnings, risk exposure, funding structure  

• corporate governance, risk management, accounting policies, and special rating situations 

Moody’s methodology also adjusts for recent changes in accounting standards, like the IFRS 17 and US GAAP LDTI, as their way of acknowledging their impact on financial metrics used in modeling and rating.  

The top 10 companies according to Moody’s 

The latest available data and Moody’s credit ratings in 2025 highlight these companies as some of the top-rated, most influential corporate entities:  

4. Standard & Poor’s 

Standard & Poor’s was founded in New York City in 1860. It is an American credit ratings agency and now a division of S&P Global, which publishes analyses of stocks, bonds, commodities, and financial research.  

S&P remains a major American financial intelligence company known for providing reliable credit ratings, indexes, and financial market research.  

Entire companies, governments, and debt instruments rely on S&P to provide them with independent credit ratings. The agency uses a letter-grade system, ranging from AAA to D to indicate their creditworthiness and level of investment risk. S&P’s most famous product is the S&P 500 index, which tracks the stock performance of the 500 largest US public companies and is used as a key benchmark for investors.  

S&P methodology 

The methodology employed by Standard & Poor’s to come up with their ratings includes a broad assessment of two core components:  

• Business Risk Profile (BRP) 
• Financial Risk Profile (FRP) 

S&P’s framework for coming up with their ratings for insurance companies involve:  

• evaluating the company whether it has adequate capital, sufficient earnings, manageable risk, minimal exposure, and flexibility in terms of its finances  

• analyzing an insurer’s business environment, competitive market position, regulatory environment, and the quality of its management 

• incorporating a detailed Insurance Industry and Country Risk Assessment (IICRA), which rates the insurer’s operating environment risks from very low to very high  

It’s important to note that S&P recently updated its rating criteria to include:  

• updated discount rates based on government bonds for reserves  

• adjusted treatment of senior debt and hybrid capital  

• recalibrated natural catastrophe stress levels  

The top 10 companies according to S&P 

The top 10 companies in 2025 ranked according to Standard & Poor’s metrics are typically determined by market capitalization and influence within the S&P 500 index. As of January 2025, based on the S&P 500 index and the SPDR S&P 500 ETF (SPY) holdings reflecting the index’s weightings, the top ten companies are:  

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What are insurance rating companies and how do they work? 

Insurance rating companies are independent organizations. Their main purpose is to evaluate the financial strength, viability, and stability of insurance providers.  

The ratings they provide play an important role in the insurance industry in that they serve as an indicator of an insurance company’s ability to meet its financial obligations. These obligations include:  

• paying insurance claims of policyholders 
• paying debts as they come due 
• fulfilling other contractual agreements 

Referring to these ratings is vital for businesses, investors, and consumers, as these are used as a guide to make informed decisions on which insurers to trust with their coverage needs. Few things can be as financially crippling as not being able to collect insurance claims when you need them. This can be especially true for individual clients who may not be able to collect life insurance, or for small businesses that need to collect insurance after a fortuitous event. 

These assessments are a valuable source of information for consumers who may lack the expertise to independently determine an insurance company’s financial health and operational performance.  

The importance of insurance company ratings 

By giving ratings to insurers, insurance rating agencies offer a quantifiable measure of their ability to meet their financial obligations. This signifies to current and prospective policyholders whether they can be relied upon to give out insurance claims, especially in their time of need.  

It’s important to note, however, that ratings agencies do not only look at an insurer’s cash flow or cash on hand. These insurance ratings companies also assess other factors before they tack on their ratings. They look at an insurer’s financial size, strength, issue and issuer credit ratings, and national scale ratings.  

This thorough evaluation can help ensure that insurance companies can meet their financial obligations to policyholders, even in the face of challenging economic conditions and widespread disasters.  

How are insurance companies rated? 

An insurance rating agency can take several factors into account when evaluating an insurance provider. Some of the attributes insurance rating companies look at may vary slightly, but there are some that they apply universally when determining their ratings. Here’s what most ratings agencies use to evaluate an insurer:  

Amount of cash in reserve  

This is the amount of funds that the insurance company has set aside to cover unexpected expenses in the short term.  

Debt-to-asset ratio  

This is a financial metric that measures the degree to which a company’s operations are fueled or funded by debt. The debt-to-asset ratio helps insurance rating agencies understand and assess an insurer’s capital structure.  

Generally, a high ratio indicates that the insurer has higher financial risk, since a higher proportion of their assets are debt driven. This makes it harder to meet obligations and secure future financing from reinsurers.   

Revenue streams  

These are the ways that a company generates its revenues on an ongoing basis. They can include reinsurance contracts, premiums paid by policyholders, investment income, service revenue, and other streams.  

Quality of insurance policies underwritten  

This is a measure of an insurance company’s accuracy, efficiency, and overall effectiveness of their underwriting decisions. This metric shows how well an insurance company evaluates a particular risk, whether to insure it, and under what specific terms and conditions.  

Ethics and risk management  

This involves identifying, assessing, and reducing risks that can harm the insurer’s reputation or commit breaches of industry codes of ethics, while managing financial and operational risks. This encapsulates how the insurer handles ethics-related issues like:  

• managing conflicts of interest  
• level of transparency with clients and industry regulators 
• compliance with regulations 
• treatment of employees   
• honesty and integrity  

Depending on the insurance rating agency, there can be other metrics in play when rating an insurance company. Some may include employee turnover or retention rates, customer service ratings, portfolio diversification, and other financial data to provide a more nuanced assessment of financial strength. 

What makes these four insurance rating agencies famous is that they are often tapped by news agencies around the world as well. You may notice these names being mentioned when discussing political or economic events and their relationships with countries’ economic situations or systems.  

These four agencies have a significant role in shaping perceptions of creditworthiness and risk in the insurance industry and beyond. Keep in mind, however, these agencies have their own criteria and rating scale with which they rate insurance agencies.  

AM Best is the largest and most famous rating agency specializing in rating insurance companies and is usually referenced for insurer financial strength ratings.  

Standard & Poor’s (S&P) rates businesses across various industries, including insurance. S&P is renowned for rating companies’ capacity and willingness to fulfill its financial obligations on time and in full.  

Moody’s is also another all-industry credit rating agency which ranks insurance companies in terms of their financial stability, market risk, and overall performance.  

Fitch, meanwhile, uses a specific ratings scale to assess the creditworthiness and financial stability of insurance companies. An “AAA” rating is the highest possible credit rating for Fitch, while “D” ratings are the lowest, and mean that the company is in default. There are many other ratings levels for Fitch; a “BBB” rating, for instance, is indicative of a good credit rating, with adequate resources for meeting financial obligations.  

Fitch's ratings systems are more nuanced than the others, using plus (+) or minus (-) signs to show minor variations within categories. For example, a “BBB+” rating is slightly more favorable than an ordinary “BBB” rating, while a “BBB-” rating is slightly less favorable than a “BBB”.  

Insurance company ratings 

An insurance company’s ratings are the most relevant indicators of its financial strength, and therefore its ability to honor policyholders’ claims. These ratings should be considered before investing in an insurance company or purchasing their products. Below is a table that shows the ratings of the four top insurance rating companies in the US and their meanings.  

Insurance company ratings in relation to underwriting  

Insurance ratings significantly influence the underwriting process, since the ratings give a measure of the insurer's financial health. Evaluating capital reserves, asset quality, profitability, and liquidity. A high rating means the insurer has a strong financial position and can effectively handle claims.  

A good insurance rating is critical for underwriters, who must ensure that the policies they issue are backed by reputable companies with sound financials and excellent track records.  

If the career of underwriter interests you, you can check out our guide on specialist underwriters like the CPCU.  

The importance of insurance ratings for risk management 

Insurance company ratings are proof of the insurer's economic resilience, operational performance, and strategic foresight. These are essential elements in assessing the overall risk profile. Insurance ratings have a real impact and influence on the actions of policyholders, regulatory bodies, and the insurance companies themselves.  

Importance for clients 

Insurance company ratings are essential for potential clients who need to make informed decisions when choosing among many coverage options. For clients, these ratings are indicators of an insurer’s financial health and ability to pay claims. Knowing whether an insurer can pay out claims is especially critical for when they experience significant financial strain due to catastrophic events.  

Importance for regulatory authorities 

Regulators rely on these ratings to identify potential risks and take the necessary preventive measures. These preventive measures are meant to protect the interests of policyholders and preserve the integrity and overall stability of the insurance market. The ratings provide a benchmark for assessing an insurer's financial strength and triggering regulatory intervention when necessary.  

Importance for insurance companies 

Insurance companies themselves can use their ratings to self-regulate and maintain high ratings. High ratings can attract more investors and customers, secure more favorable borrowing terms, and enhance market competitiveness, especially in a crowded market with many coverage options.  

Insurance rating companies and the objective assessments they provide about insurance companies are an important part of maintaining an insurance industry that inspires confidence and trust. These ratings provide policyholders, regulators, and insurance companies with a reliable measure of operational performance for making informed decisions.  

Don’t forget to check our special reports section and have a look at the best insurance providers in the US. You can also look at our company profiles section to help you find the best match for your insurance needs. Bookmark these pages for easy access.