When considering an annuity provider, it's important to research both the product and the insurance company. Be sure to ask for a product brochure and prospectus (for variable annuities). Since the guarantees on a fixed income annuity are provided by the issuing insurance company, you should consider the financial strength and claims-paying ability of the issuing insurance company. However, there are no insurance company guarantees relating to monies in the variable investment options. Financial experts suggest that an insurance company’s rating is an indicator of the company's strength that can be useful when choosing an annuity provider.*
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Ratings - Several professional rating services such as A.M. Best, Fitch, Moody's, and Standard & Poor's evaluate insurance companies and regularly publish their findings. These ratings are based on an insurance company's past performance, its current financial situation, and its ability to meet obligations. Since any income guarantee is backed by the claims-paying ability of the insurance company, it is important to choose a company with high ratings.
Where to Find Ratings
(Some rating agencies may charge for reports)
