Pursuant to a congressional request, GAO reviewed private agency ratings for life and health insurers, focusing on: (1) the rating systems of the five major raters of life and health insurers; and (2) which raters were first to report the vulnerability of financially impaired or insolvent insurers between August 1989 and June 1992.

GAO found that: (1) insurer ratings could not be easily compared, since the rating agencies did not use the same approach and methods to rate insurer financial health; (2) rating scales and descriptions of ratings varied by agency and over time; (3) one agency placed far less reliance than the other agencies on analysts' judgment; (4) one agency rated more than half of all insurers; (5) two of the agencies were less likely than the other agencies to assign insurers their top ratings; (6) two agencies provided the most comprehensive coverage of life and health insurers; (7) the agencies generally agreed on whether the insurers were secure or vulnerable; and (8) one agency was more likely to assign vulnerability ratings to financially impaired or insolvent insurers.