Unrated Insurers

Should you Insure with an Unrated Insurer?

Insurance is vital protection for any business and elements of this cover are compulsory such as Employers Liability. It can also be said that it is important to have this protection to ensure financial success for any business and there is no shortage of professional advisors to assist any business throughout the UK.

As Insurance Brokers we have a great choice of reputable insurers in the UK that are financially strong and offer a wide variety of products to business. However there are numerous ‘un-rated’ insurance markets operating within the UK that offer the same level of cover to that of their rated competitors. These Insurers do offer an advantage over their competitors as often their premiums are considerably lower which offers a solution for many business’s that are in high risk areas of industry and their insurance spend is considerably high in relation to their turnover. These unrated insurers are often the last and only option for many business’s.

However whilst there can be an obvious advantage in cost, the potential disadvantages are far more onerous and rest assured that Paterson Insurance Brokers only work with reputable, rated insurers.

What is an Unrated Insurer?

This is an Insurer that does not carry an insurer financial strength rating given by international rating agencies, such as Standard & Poors index (S&P), Moody’s, Fitch rating and A M Best.

These agencies provide an assessment of the financial strength of an insurance organisation and its ability to pay claims to its policyholders.

As an Insurance Broker we have have a choice in our selection of recommended products and insurers and it is the choice of the Broker to use rated or unrated insurers (there is no legal requirement for an insurer to be rated).

What are the Risks?

  • They offer no independent verification of their ability to pay claims to their policyholders
  • Unrated insurers are typically based in continental Europe and they are not held to the same requirements on solvency test as insurer’s are in the UK
  • Their service levels are often not as good as the rated market

Recent Unrated Insurer Failures

On the 17th November 2016, Gable, an unrated Leichtenstein insurance company went into liquidation with an automatic cancellation date of the 16th December 2016 leaving policyholders to place alternatives within one month.

Many business’s were faced with a doubling and tripling of their insurance spend in this period and only the smaller business with under £1,000,000 turnover were eligible for the protection under the FSCS compensation scheme


A similar high profile collapse of Enterprise Insurance occurred in October 2016.

Get the best Advice………

At Paterson Insurance Brokers we take our professional obligation and duty of care of our clients very seriously and will not use unrated Insurers under any circumstances.

All our clients get the very best of advice not just on the cover they purchase but also around the quality of their insurer and ability to provide a quality service and importantly….pay claims.

If you need independent advice on any aspect of insurance or help with issues surrounding the demise of Gable or Enterprise please contact Paterson Insurance today


We’ll call you

or call us on 0113 831 4024

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