Life Insurance Health Ratings are like a Ladder

By October 12, 2020 No Comments
Health Rating Ladder

Life Insurance Health Ratings:

Pricing of life insurance policies are determined by the health rating you can qualify for with a given life insurance company.  Health ratings can be complicated so we are here to help you understand what goes into the pricing of a policy.

Here are a few factors that go into calculating a premium:

  • Age
  • Mini health exam and questions (health exam not required for all products)
  • Medical records from your doctor
  • Motor vehicle report
  • Lifestyle choices (e.g. racing, skydiving, scuba diving, flying planes, etc.)

Insurance underwriters will find out everything there is to know about your health and try to make a responsible rating decision based on their company’s underwriting guidelines. There are databases underwriters use called the Medical Information Bureau (MIB).  They utilize this database to check for prescriptions prescribed to the proposed insured and to see if there are other recent applications pending with other insurers. The MIB’s mission is to uncover errors, omissions, misrepresentations on insurance applications to reduce fraud so companies can offer, and consumers can purchase affordable life insurance protection.  Therefore, it is imperative to tell your insurance agent and to disclose as much information on your exam and application, as you can. By doing this, it also helps your agent’s quotes be as accurate as possible.

Each insurance company has different underwriting standards. One insurance company may consider a particular health problem as a deal breaker, where another may consider it to be perfectly fine. These differences can make a huge impact on giving you an accurate quote and subsequently, lower premium.

Along with age, health information, and lifestyle choices impact what is called a Health Rating (also commonly known as the risk classification). A Health Rating is what insurance companies use to price out your insurance premiums. The easiest way to understand health ratings is by imagining a ladder. In the middle, there is Standard (normal life expectancy) and depending on your particular health history and lifestyle you can go either up or down the ladder. Preferred Plus is the best possible health rating, whereas Table-Ratings are substandard.

Represent the scale of life insurance health ratings

Health Ratings Ladder

If you have any questions about health ratings or want to get a free no-obligation life insurance quote, call us today at 1-888-972-0024. You can also send us an email by clicking below:

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