It is not required for a driver who is pulled over for drunk driving to submit to a sobriety test. If the case goes to court, failure to submit is not considered “guilt beyond a reasonable doubt.” But informally the implication is guilt within a reasonable doubt. I share this based on experience as a juror in such a court case, where we reluctantly found the defendant Not Guilty.
Analogously, it is not required that every insurer apply for an A.M. Best rating. I think there is an informal reason why an insurer would not, but this is within and not beyond..
What is the fee to apply for an A.M. Best rating? Is there any reason why an established, admitted insurer would not apply, other than the obvious?
There can be effort involved in working with A.M. Best to get them the information required to prepare/review ratings. I’ve been on the grunt-work side of a few A.M. Best surveys and…it was inconvenient.
I can easily imagine that there are non-negative reasons that a niche insurer or a small US subsidiary of a large international insurer might choose to avoid those headaches particularly when their customer base or their lenders don’t actually require a Best rating.
(Before we were acquired, my employer spent a LOT of time and effort on Best stuff, and BCAR factored into our ERM scorecards. Then we were acquired by a larger insurer, and while I can see we have Best ratings…I haven’t had to mess with modeling BCAR, or respond to pesky information requests, or even hear about anything Best-related in a long time.)
Google “am best compensation disclosure” - it looks like it’s up to $1.5m per issuer per year. (Tried to include a link, but AM Best flagged the link to their site as a bot.)
So depending on the size of the operation and how sensitive their target market is to the absence of a rating it could be a strategic decision, rather than something nefarious. What’s their target market? Do they have any other ratings?