A.M. Best

DEFINITION of 'A.M. Best'

One of the established ratings agencies recognized by the SEC. A.M. Best has traditionally focused exclusively on providing a letter rating for insurance carriers. It has recently branched out into rating financial securities such as bonds. The company basically measures one's ability to fulfill its debt obligations. Ratings range from A++ (superior) to S (suspended).

BREAKING DOWN 'A.M. Best'

Alfred M. Best founded the company named after him in 1899. The company moved from New York to New Jersey in 1965 and is currently headquartered in Oldwick. A.M. Best is a privately-owned enterprise and publishes several ratings periodicals using data reported to the NAIC.

RELATED TERMS
  1. Insurance Company Credit Rating ...

    The opinion of an independent agency regarding the financial ...
  2. Letter Security

    A security that is not registered with the SEC, and therefore ...
  3. Ba1/BB+

    This is generally one of the lowest investment grade ratings ...
  4. A+/A1

    One of the top ratings that a ratings agency assigns to an issuer ...
  5. A/A2

    Usually the second- or third-highest rating that a rating agency ...
  6. B3/B-

    One of the lower ratings that a ratings agency assigns to a security ...
Related Articles
  1. Professionals

    Bond Ratings

    We look at the different ratings firms and explain what different bond ratings mean.
  2. Investing

    The Power of Major Credit Rating Agencies

    The performance of major independent credit rating agencies is a controversial topic, particularly due to the strength of their influence.
  3. Home & Auto

    A Brief History Of Credit Rating Agencies

    Credit rating agencies have a long history in this country. Learn about what they do and how were they developed.
  4. Investing Basics

    The Industry Handbook: The Insurance Industry

    As a result of globalization, deregulation and terrorist attacks, the insurance industry has gone through a tremendous transformation over the past decade. In the simplest terms, insurance of ...
  5. Investing Basics

    What Is A Corporate Credit Rating?

    Is the bond you're buying investment grade, or just junk? Find out how to check the score.
  6. Forex Education

    These Are The Best Hours To Trade the British Pound

    The best times to trade the British pound are centered around economic releases at 1:30 am, 2:00 am, 8:30 am and 10:00 am U.S. ET.
  7. Bonds & Fixed Income

    Why Bad Bonds Get Good Ratings

    Credit ratings are not the only tool to rely on when assessing bonds. Find out why they sometimes fall short.
  8. Investing Basics

    What's a Debt Security?

    A debt security is a financial instrument issued by a company (usually a publicly traded corporation) and sold to an investor.
  9. Choosing a Long-Term Care Insurer

    As with any insurance product, you want to make sure you’re buying your long-term care policy from a reputable insurance company: one that honors its contracts and has the financial means ...
  10. Investing

    What does Free Carrier Mean?

    Free carrier is a trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. Costs for transportation and risk of loss transfer ...
RELATED FAQS
  1. Why should I consider looking for the A.M. Best rating before investing in an insurance ...

    Find out about the rating system that A.M. Best uses to provide financial strength ratings for companies in the insurance ... Read Answer >>
  2. Should I be worried about my insurance company?

    Yes, policyholders should also take a serious look at the financial stability of their current insurance company especially ... Read Answer >>
  3. How do I choose which insurance company to use?

    Picking an insurance company to use is not an easy task, considering the financial crisis of 2008 and 2009. Several financial ... Read Answer >>
  4. How do companies like Moody's rate bonds?

    Rating the creditworthiness of a bond issuer, despite the number crunching, is as much an art form as it is a science. While ... Read Answer >>
  5. How much do changes in interest rates affect the profitability of the insurance sector?

    Learn about the relationship between interest rates and insurance company profitability, and how interest rates can affect ... Read Answer >>
  6. During what time does after-hours trading (AHT) occur?

    A lot of buying and selling can be done outside of the traditional trading hours. Find out when after-hours trading starts ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center