How AM Best Ratings Can Help When Shopping for Travel Insurance
The world is unpredictable. From political unrest to weather disruptions — a vacation can quickly become untenable. However, reliable travel insurance can offset risk and worry.
When faced with the daunting task of navigating providers and policies, AM Best Ratings can provide a sense of relief. They serve as a reliable guide, ensuring you’re selecting the most trustworthy provider for your specific needs.
By understanding who AM Best is, what their ratings mean, how they are determined, and why they matter when shopping for travel insurance, you are empowered to make informed decisions.
Who is AM Best?
AM Best is a globally recognized rating agency that focuses on measuring, rating, and scoring insurance providers’ financial stability.
For 125 years, they’ve evaluated insurance companies’ financial health and stability to give shoppers like you an easy way to determine if an insurance provider will follow through with their commitment to you. Their website offers up to five years of ratings history free of charge, giving you a look at how a company has trended over time.
After conducting a comprehensive analysis of balance sheets, operating performance, business profile, and enterprise risk management, the AM Best Rating scale grades providers from A++ (Superior) to D (Poor), with various intermediate ratings indicating differing levels of financial strength.
Since almost all major insurers are listed on their site, comparing ratings from one company to another is easy. When looking for travel insurance, we recommend sticking to companies with an FSR of A- or higher.
Why AM Best Ratings Matter
These ratings could mean having your claim fulfilled or pending.
AM Best Ratings are a trusted benchmark in the insurance industry, providing a reliable measure of an insurer’s financial health. You can trust these ratings to guide you in making secure and confident insurance choices.
- Financial Stability: If an unexpected medical emergency arises, the last thing you want to worry about is whether your insurance company can pay your claim. A high AM Best rating means the insurer is financially stable and reliable.
- Trust and Reliability: High AM Best ratings suggest a well-managed company is more likely to honor claims. Knowing you can trust your provider to deliver on its promises provides an invaluable sense of security, particularly if you have health risks or are traveling to an unfamiliar location.
- Comprehensive Evaluation: The rating process considers various aspects of an insurer’s operations, including risk management practices and market position. This comprehensive evaluation means that AM Best ratings provide a well-rounded view of an insurer’s capabilities, empowering you to make an informed decision.
- Comparison Tool: AM Best ratings simplify the policy vetting and review process. Instead of relying solely on price or coverage details, you can quickly identify which companies are financially sound, saving time and effort in searching for the perfect travel insurance.
But how does this score help? Consider the following scenarios:
Scenario 1: Imagine you’re planning a month-long trip to Europe. You have pre-existing health conditions that make comprehensive travel insurance essential. Two companies offer similar coverage at comparable prices, but one has an AM Best rating of A (Excellent) and the other B+ (Good). Opting for the insurer with the A rating ensures you choose a provider with a stronger financial position and better ability to pay claims.
Scenario 2: In another scenario, consider an older couple traveling to a remote destination where medical evacuation might be necessary. The cost of such a service can be astronomical, but having an insurer with a high AM Best rating means your claim has a good chance of being fulfilled.
How to Use AM Best Ratings When Choosing Travel Insurance
- Check the Ratings: Check an insurance company’s AM Best Rating before buying a travel insurance policy. You can find these ratings on our site, the AM Best website, or the insurer’s site.
- Understand the Rating Scale: Familiarize yourself with the AM Best scale. Aim for insurers rated A- (Excellent) or higher. These ratings indicate high financial strength and stability, reducing the risk of claims not being honored.
- Evaluate Other Factors: While AM Best Ratings are crucial, they should be part of a broader evaluation. Consider the coverage options, premiums, customer reviews, and any additional benefits the insurance policies offer.
Selecting the right travel insurance is more than just picking the cheapest policy. The insurer’s financial stability and reliability are paramount, and AM Best ratings are essential for assessing these qualities.
Why Squaremouth Trusts AM Best Ratings
At Squaremouth, we’re committed to helping you find the best travel insurance. We rely on AM Best Ratings because they provide a reliable benchmark of an insurer’s financial health. Squaremouth only offers policies from companies with an AM Best Rating of “Excellent” or higher. By prioritizing insurers with high ratings, we ensure that you have access to providers who are not only trustworthy but also capable of delivering the protection you need.
Bottom Line: Remember, AM Best ratings are just one way to help advise you on the health of a provider before you commit to purchasing a policy for your upcoming vacation. When combined with other factors like coverage amounts, the price of the policy, and the types of coverage offered, you can ensure you’re traveling as safely as possible.