Financial-sector model
The Moat Score reads a business through margins and returns on invested capital. That lens fits companies that make things or sell services — but a bank’s raw material is deposits, an insurer’s is float, and for both, leverage isn’t a risk bolted onto the business model; it is the business model. Concepts like gross margin and invested capital stop meaning what the scoring formulas need them to mean.
Operating companies use the Moat Score. Covered banks and insurers are scored under a separate financial-sector model with its own components and calibration; financial-sector scores are never ranked, averaged, or described as comparable with the operating Moat Score. A published financial-sector score is always labeled with its model and methodology version, including on JPMorgan Chase, UnitedHealth Group, and the Berkshire page.
How the financial-sector model works
The model reads return-on-equity quality, capital strength, earnings stability, and book-value growth, plus net-interest or underwriting measures when they apply. A component abstains when the filings do not support it, and the coverage gate withholds the composite when too little remains. Insurance agents and brokers, REITs, and other real-estate or holding and investment businesses are not covered by this model today; they remain not scored rather than being forced into either scale.
The methodology states the split, and each model keeps its own append-only history. A future model change arrives with a new methodology version, never as a silent edit.