How to check any insurance carrier's financial strength
A fixed indexed annuity's protections — the floor of zero, the credited interest, the income rider if you choose one — all depend on the insurance company's ability to pay its claims for decades. You can check any carrier's financial strength yourself, for free, in about ten minutes, using the rating agencies that grade insurers. No agent's word required, including mine.
Why this is the check that matters
An FIA is not FDIC insured — it's a promise from a company. So the durability of that company is not a detail; it's the foundation. The good news: life insurance carriers are among the most closely watched companies in the country. State regulators examine them, they hold required reserves, and independent rating agencies grade their financial strength continuously and publish the results.
The ratings, in plain English
Four main agencies rate insurers: AM Best (the insurance specialist), S&P Global, Moody's, and Fitch. Each uses letter grades, and each scale differs slightly — AM Best's top grades run A++ and A+, then A and A−, and downward from there. Two practical rules cut through the alphabet. First, look for carriers in the A range from the agency you check — that range signals a company the raters judge strongly able to meet its obligations. Second, a rating is an independent professional opinion, not a certainty about the future — which is exactly why you check it rather than skip it.
How to run the check (10 minutes)
- Get the carrier's exact legal name. Insurance groups have many subsidiaries; the rating that matters is the one on the company actually issuing your contract. It's on the first pages of any illustration or contract — and any agent should hand it over instantly.
- Look up the rating at the source. AM Best's website lets you search a company and see its rating for free with a basic account. Carriers also publish their current ratings on their own sites — fine as a starting point, but the agency's site is the source.
- Confirm the company is licensed in Washington. The Washington Office of the Insurance Commissioner (insurance.wa.gov) lets you verify any company — and any agent, me included — in about a minute.
- Ask for it in writing. Any agent should be able to put the issuing carrier's name and current ratings in front of you without being asked twice. Watch what happens when you ask. It tells you about the agent, too — more tests like this one in the three questions.
What I do with ratings
I talk about carrier strength openly because the whole design of these contracts leans on it — that's also why it comes up in how the floor of zero works. What I don't do on this site is name carriers or quote their ratings; those belong in a real conversation about your actual options, with current documents in front of us.
The full plain-English explainer — mechanics, tradeoffs, and who it's wrong for — is here: how fixed indexed annuities actually work.
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