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- How does your insurance company rate?
- October 5th, 2010 11:11 AM
Life insurance is weighted on the amount of risk involved to determine the future outcome of insuring someone. When you apply for life insurance your health and any risks to your wellbeing must be taken into consideration. But how many think about the overall health of their insurance companies or the innumerable risks that can determine its future?
Like other types of businesses, life insurance companies are rated. Those ratings comprise important information about a company that measures its financial health and provides consumers with a way to compare one company’s fiscal wellbeing with others.
Essentially, risk-based capital or RBC represents an assessment of risks that a company should maintain to protect its customers against unfavorable developments.
The purpose of the RBC calculations and comparisons is to help identify the risk for a life insurance company’s future failures and losses.
There are four categories of risk-based capital:Pages: 1 2
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