Moriarty & Dee, Attorneys at Law, in Buffalo, New York.

How to Rate Life Insurance:

HOW TO KNOW WHEN THE LIFE INSURANCE POLICY SECURING YOUR CLIENT'S PROPERTY SETTLEMENT AGREEMENT WILL DO THE JOB

Article published by the American Bar Association Family Law Section, written by senior partner Robert B. Moriarty, Esq.

Okay, so you have done a great job for your client, wife of the president and sole stockholder of the XYZ Widget Company. You have maximized your leverage in this 30-year marriage, using it and your client's age and lack of employment history to obtain long-term maintenance and a substantial distributive award. And best of all, it's secured by life insurance, so if Mr. Jones leaves this good earth before his time (which from your clientís point-of-view means before she does), an insurance policy kicks in to protect the award you have worked hard to obtain.

Or does it? In 1991 two industry giants, Executive Life and First Capital Life, failed and a third, Mutual Benefit Life, also collapsed. If you had tried to determine the viability of these companies, chances are you would have consulted A.M. Best, Standard and Poor's, Moody's and/or Duff's and Phelps, the four best known rating agencies. Chances are also their rating would not have helped you.

In June, 1990, Standard and Poorís and Duff & Phelps rated Executive Life "BBB" and "BBB-", respectively meaning good. A.M. Best, the oldest and biggest of the agencies, issued an "A" rating, meaning excellent, although it said the company could be downgraded.

Moody's was more on the top of the situation, although it equivocated by issuing a "Ba2" rating , meaning questionable. But would you have understood what a "Ba2" rating meant? Again, chances are you would not have.

HOT TIP: If you want a quick, understandable rating on an insurance policy, consult Weiss Research, Inc., 220 North Florida Mango Road, West Palm Beach, Florida 33409 (407) 684-8100. It also has a toll-free number, 1-800-289-9222.

Weiss rates in an easily understandable manner--A+ through F-- and will give you a quick rating over the telephone for $15. It is something of a pariah in the insurance industry because its views are bearish, and Weiss has been accused of encouraging consumers to worry for its own financial gain.

But from the point-of-view of a matrimonial lawyer who wants to be sure the life insurance used to secure a client's property settlement is a good one, Weiss' conservatism is just the ticket. Lending credence to its ratings is the fact the biggest companies in the insurance industry pay big sums of money to Standards & Poor's Corporation, Moody's A.M., Best and Duff & Phelps to rate their companies, and therefore certainly cannot be considered neutral or independent in the services they render. Weiss receives no income from insurance companies.

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