AM Best Ratings Explained: What Insurance Company Ratings Mean

An AM Best rating is an independent opinion of an insurance company's financial strength: its ability to pay the claims it owes on its policies. The Best's Financial Strength Rating scale runs from A++ (Superior) down to D (Poor), and B++ or better counts as secure. Many contracts and lenders still require A- or better.

The full scale has seven categories:

• A++, A+: Superior
• A, A-: Excellent
• B++, B+: Good
• B, B-: Fair
• C++, C+: Marginal
• C, C-: Weak
• D: Poor

Separate non-rating designations E, F and S flag insurers under regulatory supervision, in liquidation, or with a suspended rating.

The rating answers one narrow question: will this insurer still be solvent and paying when your claim arrives, possibly years after you bought the policy? That makes it one of the few numbers on a proposal worth checking before you look at price.

What is an AM Best rating?

An AM Best rating is a letter grade that AM Best, a credit rating agency founded in 1899 that specializes in insurance, gives an insurer after judging whether it can meet its ongoing policy obligations. AM Best's Guide to Best's Financial Strength Ratings defines the rating as an independent opinion of financial strength and ability to pay claims.^[1] When a proposal or contract mentions an insurer's AM Best rating, this letter grade is what it means. It measures solvency, not customer service or price.

AM Best builds the opinion from four blocks: balance sheet strength, operating performance, business profile and enterprise risk management (ERM).^[2] Balance sheet strength is the starting point, and the other three move the rating up or down from there. AM Best is also clear about the limits: a financial strength rating is not a recommendation to buy, keep or cancel a policy, and it is not a guarantee against insolvency.

What do AM Best rating letters mean?

AM Best's letters map to seven categories of claims-paying ability. Superior (A++ and A+) and Excellent (A and A-) are the strongest insurers and cover most of the standard market. Good (B++ and B+) still describes a secure insurer. The wording changes at Fair (B and B-), where the definition first mentions vulnerability, and gets harsher through Marginal (C++ and C+), Weak (C and C-) and Poor (D). AM Best defines the categories, not the individual letters:

The plus and minus signs are steps inside a category, so A- is still Excellent and B+ is still Good. A few symbols below D are not ratings at all but non-rating designations: E for an insurer placed in conservation or rehabilitation, F for one in liquidation after a finding of insolvency, and S for a rating suspended because AM Best lacks the information to evaluate a sudden event. NR means not rated. An NR is worth a phone call: some insurers never asked for a rating, and others let one lapse before bad news.

Is a B++ rating good?

Yes. AM Best puts B++ and B+ in its Good category, the third of seven and inside its secure range. Many buyers see a B and assume the insurer is struggling, but that reading is wrong. Real caution starts at B and B-, the Fair category, where AM Best's definition adds "vulnerable to adverse underwriting and economic conditions."

In practice, much of the market sets a higher floor. Construction insurance specifications usually require AM Best A- VII or better, lender mortgagee clauses often repeat that floor, and excess and umbrella underwriters want rated insurers beneath them before they sit above your excess liability program. A B++ policy can be perfectly sound and still fail the insurance requirements on your next job.

Why do AM Best ratings matter for surplus lines buyers?

The rating matters most for surplus lines buyers because no guaranty fund backs a non-admitted insurer. An admitted carrier takes part in its state's guaranty fund, which pays covered claims if the insurer fails. Most states cap that recovery at $300,000 per claim or the policy limit, whichever is less, according to the National Conference of Insurance Guaranty Funds.^[3] A surplus lines insurer has no fund behind it, so if it becomes insolvent in the middle of your claim, its own balance sheet is the only source of payment.

Eligibility rules narrow the field but do not grade quality. Under the federal Nonadmitted and Reinsurance Reform Act of 2010, a US-domiciled surplus lines insurer generally must hold at least $15 million in capital and surplus,^[4] and non-US insurers usually appear on the NAIC Quarterly Listing of Alien Insurers.^[5] Those are solvency floors, not quality grades. The rating is what separates a merely eligible insurer from a strong one. Your surplus lines broker should show it as routinely as the premium and recheck it at renewal, because a downgrade below A- can break loan covenants and contract requirements mid-term. When we place excess and surplus lines insurance, the insurer's rating is on the proposal.

How do you look up an insurance company's AM Best rating?

You can look up almost any insurer's current rating in a few minutes with the free Rating Search at ambest.com, after registering. The key is searching for the right company. An insurance group can include many writing companies, each with its own rating, and they do not always share one. Search for the exact legal entity name on your declarations page, not the group's brand name.

1. Find the exact writing company name

   Take the insurer's full legal name from your declarations page or certificate, not the trade name. A group may write your policy through a subsidiary rated differently from its flagship company.

2. Search the rating on ambest.com

   Search for that exact legal name on ambest.com and check that the state of domicile matches your paperwork, so you do not read a sister company's rating.

3. Read the full rating unit

   Note the letter grade, the outlook and the Financial Size Category, a Roman numeral for the size of the insurer's surplus. Class VII means $50 million to $100 million, and Class XV means $2 billion or more. That is why specifications read "A- VII or better".

4. Check the rating again at each renewal

   Verify the rating at each renewal, because an insurer rated A- when the policy was bound can be downgraded mid-term.

Also check with your state insurance department. It confirms whether the company is licensed or surplus lines eligible, and it shows complaint records that the financial rating does not measure.

AM Best ratings of major insurers (as of July 2026)

Most large national insurers hold ratings in AM Best's top two categories, Superior and Excellent. The grades below are each insurer group's published Best's Financial Strength Rating as of July 2026, compiled from AM Best rating announcements, carrier disclosures and annual SEC filings. A rating applies to a named rating unit, and writing companies within a group can carry different grades, so always check the exact company on your declarations page. Insurers are listed alphabetically:

Ratings change as AM Best completes its reviews, so confirm your writing company's current rating with the Rating Search at ambest.com before relying on this table.^[6]

This guide is for educational purposes. Ratings are the independent opinions of the rating agency, not guarantees, and can change at any time. Verify a carrier's current rating at ambest.com and talk to a licensed broker about your actual exposures.

Checking a rating before you bind

An AM Best rating is an independent opinion of whether an insurer can pay the claims it owes, graded from A++ down to D. B++ and B+ mean Good, not troubled, but many contracts and lenders still require A- or better, so a sound insurer can still fail your paperwork. Before you bind, look up the exact writing company's grade and outlook at ambest.com and compare it with your contract's minimum.