Rating service

Rating Service

A company that evaluates preferred stocks and debt securities based on the likelihood of default. The ratings service provides an objective rating to the security; the rating is higher when the likelihood of default is lower. There are three main ratings services: Moody's, Fitch, and Standard & Poor's. Companies issuing new preferred stocks or debt securities pay one or more of the ratings services to have their securities rated. Banks are not allowed to invest in securities with ratings below a certain level. See also: Investment-grade, Junk.

Rating service.

A rating service, such as A.M. Best, Moody's Investors Service, or Standard & Poor's, evaluates bond issuers to determine the level of risk they pose to would-be investors.

Though each rating service focuses on somewhat different criteria in making its evaluation, the assessments tend to agree on which investments pose the least default risk and which pose the most.

These rating services also evaluate insurance companies, including those offering fixed annuities and life insurance, in terms of how likely a provider is to meet its financial obligations to policyholders.

References in periodicals archive ?
These NRSROs have assured policymakers that they have erected adequate firewalls between their rating service and advisory service operations.
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ePolicy Solutions will integrate the ISO Rating Service with RightRisk(TM), its enterprise policy administration software solution.
The ISO Rating Service, which incorporates ISO's rating information with powerful rating software and a robust rate-management toolset, will provide Amerisure with rating information and automated, ongoing rate maintenance and analysis for six ISO commercial lines in 50 states.
Merrill Lynch Canada Finance Company has received written confirmation that the notes issued under its medium term note program are rated "AA(low)", "A+", "Aa3" and "AA-" by Dominion Bond Rating Service Limited, Standard & Poor's Ratings Services, Moody's Investor Services, Inc.
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Standard & Poor's--Standard & Poor's Rating Services today placed its 'BBB+' rating on the class B notes issued by Paper Bond Ltd.