Preferred Insurance Rating

• The best health rating class for term insurance is the preferred class. Only 15 percent of applicants qualify for this class due to its strict health requirements. To qualify for a preferred rating, an applicant must have no issues in health history, meet the height and weight guidelines of the company, and test within normal levels of cholesterol and blood pressure. A family history of disease, poor driving record and risky hobbies can disqualify an applicant from this class. As the healthiest risk class, the preferred term rating is the least expensive life insurance.
  
  

Standard Insurance Rating

• A standard insurance rating is more common for a life insurance applicant. Applicants with a family history of disease, have minor health conditions, or above normal cholesterol levels would be placed in this category. Individuals who apply several years after recovering from a major medical issue would also be placed in this category. Smokers who meet the standard rating health conditions are placed in a smoker standard class to account for the higher health risk of smoking.
  
  

Substandard Insurance Rating

• People with more severe medical issues are placed in a substandard category. This is the most expensive rating of term insurance. Insurance companies have a range of substandard ratings depending on the severity of the applicant's health issues. There is no defined formula to determine which substandard category an applicant will be placed in. This is determined by the life insurance underwriters on a case-by-case basis.
  
  

Uninsurable Insurance Rating

• Some applicants will be considered too high a risk for life insurance and will be declined by their insurance company. Applicants in this category are often terminally ill, have just undergone a major surgery, or are extremely obese. Life insurance options for individuals in this class are limited. Declined applicants can apply for no underwriting life insurance. This insurance is guaranteed issue for small face amounts. Another option would be to apply for insurance through a work group plan, as this life insurance is guaranteed issue for a certain face amount.