What does our company rating show?
Each company review leads with the insurer's financial strength ratings from the independent agencies: AM Best, S&P Global, Moody's and Fitch, exactly as those agencies publish them, with the date. We do not invent a score of our own. We then explain, in plain English, what those grades mean for you and what else matters: who owns the company, how long it has operated, what it sells and who it fits.
What a financial strength rating measures
A financial strength rating is an independent opinion of how likely an insurance company is to pay its policyholders, including you, for the life of the contract. Agencies look at capital, the quality of the investments behind the reserves, profitability, management and how the company would hold up in a bad economy.
It is a rating of the company, not of any single annuity. A top-rated insurer can still sell a product that is a poor fit for you, and a smaller insurer can sell a very good one.
How we read the ratings
We show every agency that rates the company, side by side, and we lead with AM Best because it rates nearly every U.S. life insurer. When agencies disagree, we say so. When a company is rated by only one agency, we point that out, because a second opinion adds confidence.
| Agency | Top grades | Where "strong" starts |
|---|---|---|
| AM Best | A++ and A+ (Superior) | A and A- (Excellent) |
| S&P Global | AAA (Extremely strong), AA (Very strong) | A (Strong) |
| Moody's | Aaa (Exceptional), Aa (Excellent) | A (Good) |
| Fitch | AAA (Exceptionally strong), AA (Very strong) | A (Strong) |
Plus and minus signs, or numbers 1 to 3 at Moody's, mark steps within each grade.
What else we weigh in our verdict
Ratings come first, but they are not the whole story. Every company review also covers:
- Ownership and capital. Mutual company, public company or owned by an investment firm, and what that means for how your guarantee is backed.
- History and size. How long the issuing company has operated and how large it is.
- What it sells. The annuity types it offers and whether its products are competitive today.
- Consumer record. Complaint trends from state regulators where the data is meaningful.
- Who it fits. The buyer the company serves best, and who should look elsewhere.
The scale in practice
For most buyers, A- (Excellent) or better from AM Best is a sensible floor for a long-term contract. Many people prefer A or higher, especially for income they will rely on for decades. Below A-, we still review the company, but we explain the extra risk clearly and compare it with stronger alternatives.
Companies without ratings
Some newer or smaller insurers have no rating from a major agency. We still review them when readers ask, but we state plainly that no independent agency has graded them, and we explain what that means for you.
How we stay independent
- The ratings we display come directly from the agencies. We never adjust them.
- Commission levels play no part in any review or verdict.
- We review companies we are not appointed with the same way we review those we are.
- Every review is written and checked by a licensed strategist. See our editorial policy.
Data sources and updates
Ratings come from the agencies' own public announcements and rating lookups, plus company press releases. We note the month each rating was affirmed. We recheck ratings whenever we update a review and review every company page at least twice a year.
Limits you should know about
A rating is an opinion about the future, not a guarantee. Ratings can change, and agencies sometimes act after trouble has started. That is why we suggest checking the current rating on the agency's site before you sign, and why your state's guaranty association is a useful second layer of protection.
Questions about a specific rating
If you think a rating on our site is out of date, contact us and we will check it against the agency's latest publication and correct it if needed.
Frequently asked questions
Do you give higher ratings to companies that pay you more?
No. The ratings we show come straight from the agencies. Our written verdict is based on strength, history, products and fit. Commission levels are never part of it, and we review companies we are not appointed with the same way.
How often do you update ratings?
We check a company's ratings whenever we update its review, and we review every company page at least twice a year. If an agency upgrades, downgrades or changes its outlook in between, we update the page as soon as we learn of it.
Is a higher rating always better for me?
Higher strength is better, but it usually comes with lower rates. Many buyers are comfortable with A- or better. Others want A or higher. Our reviews tell you where each company falls so you can apply your own rule.
Sources
Educational only, not investment, tax or legal advice. Tax Free Wealth Plan LLC is a licensed insurance agency, not a registered investment adviser or broker-dealer. Annuities are not bank deposits, are not FDIC insured and are not guaranteed by any government agency. Guarantees are backed solely by the claims-paying ability of the issuing insurance company. Features, rates and availability vary by state and change over time; the contract and disclosure documents govern.