How can an individual determine how reliable or likely an insurance company is to pay on their claims? I'm trying to balance two things here - cost of premiums and reliability of paying claims. I have second hand knowledge from a person that I trust that some companies (such as American Family Insurance) may have vary unscrupulous practices to "reduce their costs" which involve dragging out legal matters.

I have used a number of different car insurances in the past, but now as a homeowner, I have to insure the following:

  • my home
  • my car
  • my wife's car
  • my wife's wedding ring

Ideally I'd like to find reasonably inexpensive insurance for all of these things under one roof. Any suggestions on the best way to find the best value (lowest cost for highest chance of paying without a whole lot of paperwork)?

I'm not just looking for recommendations here (they are appreciated) but the process that an individual can go through to determine if an insurance company is scrupulous.

3 Answers 3


AM Best is a well known rating service that measures the financial stability of Insurance companies and other financial providers. They issue a score that works kind of like a corporate credit score for each company using the following system.

A++, A+ (Superior)
B, B- (Fair)
A, A- (Excellent)
C++, C+ (Marginal)
B++, B+ (Good)

C, C- (Weak)
D (Poor)
E (Under Regulatory Supervision)
F (In Liquidation)
S (Suspended)

In most cases, there really is no good reason to get insurance from a company with less than an A++ rating, at least according to financial guru Clark Howard.

It is worth mentioning that I don't think this scoring system accounts for how hard it is to file a claim or whether they tend to reject them unfairly. It mostly tells you how likely they think the company is likely to be ABLE to pay claims based on how financially stable they are.

Note: They require registration to see the info, but it is free as far as I know.


Found this resource:


I think the ratings on the site are lower than they probably should be because people with a bone to pick are more likely to complain, whereas decent, but not outstanding, service will be left unrecognized.

Poking around a bit, though, your company didn't fare too badly.

With sites like this, I'd look at the number of respondents for that company as well as the demeanor of respondents overall across the site.

That, or google "XYZ Insurance sucks" to get more dirt.


Consumer Reports will rate insurance companies on quality of service. I think AM Best and Consumer Reports (for the United States) are a good combination of whether or not a company should earn your business.

You level of tolerance to scrupulous behavior is important as well as your expectation of customer service.

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