What Is a Life Insurance Health Classification?

A Life Insurance Health Classification Explained

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Definition

A life insurance health classification is a category that an insurer puts you in to help determine whether to cover you and what premium you’ll pay. Insurance companies use information about your current health, medical history, family history, lifestyle habits, and other factors to figure out what level of risk you present and what your health classification should be.

Key Takeaways

  • Life insurance companies use health classifications to categorize policyholders according to the amount of risk they present.
  • If you’re put in a higher-risk health class, you’ll pay a higher premium or may not be approved for coverage at all.
  • Common life insurance health classifications are preferred plus, preferred, standard plus, and standard—and there may be special classifications such as preferred nonsmoker or preferred smoker.
  • Health class assignments are based on factors including height, weight, medical history, tobacco use, and other lifestyle choices.
  • Health classifications vary from one insurance company to the next, so you can find the best deal by shopping around and getting quotes.

How a Life Insurance Health Classification Works

Insurance companies group people according to their risk level—which roughly translates to how long they expect you to live. To do that, insurers consider the entirety of your application, including your answers to questions about your:

  • Health
  • Health history
  • Family’s health history
  • Lifestyle
  • Habits
  • Occupation

They also may access your driving records, prescription history, and credit report to help determine which risk class to put you in.

Once this information is reviewed, the underwriter creates your risk profile and places you in the corresponding health or rate class. The classification impacts your eligibility for coverage and the premiums you’ll pay for your policy if you are approved. Age and gender will also have an impact on your premiums.

The goal of this process is to estimate your lifespan and figure out how much your coverage should cost.

If the insurer thinks you are likely to die sooner than your peers, you’ll be placed into a higher-risk health class. In this case, you’ll pay more for a life insurance policy, or possibly not be offered one at all. But if the insurer considers you a low risk, you’ll be in a lower-risk class, or a “preferred” or “plus” category. If this is the case, you’ll likely be approved at a relatively low premium for your age group.

Types of Life Insurance Health Classifications

Insurance companies tend to develop their own health classification systems, so health classes may vary between insurers. However, many insurers have a few rating tiers for their applicants and terminology is often similar within the industry. Some examples include:

  • Preferred Plus: This is the highest classification for policyholders. Weight-to-height ratio, cholesterol, and blood pressure are normal, and the policyholder doesn’t have a history of medical problems.
  • Preferred: This classification is for a policyholder who has good health overall but has a factor that puts them at slightly higher risk; for example, they may have a blood pressure issue that a doctor is treating.
  • Standard Plus: A policyholder in this class is generally healthy but may have a few health issues that they are managing, or a few other factors that increase their risk level.
  • Standard: When a policyholder has a few factors that present more serious risks, often including a more significant medical condition, they will fall into this classification.

Tobacco plays a role in your health classification, too. For example, an insurance company may not put you in the top tier if you’ve used tobacco at any time in the past three years. Your insurer might also give you a special tobacco designation, such as preferred tobacco or standard tobacco.

Note

If you don’t qualify for one of the four main health classes, insurers may give you a “substandard” classification. However, don’t be discouraged. Your health classification and policy cost can vary with each insurer, so you might get a better offer somewhere else.

Factors Used To Determine Health Classification

Let’s take a closer look at some of the factors that are commonly used to determine which health classification is assigned to an applicant:

  • Height to weight ratio: A range of weights is often provided based on an applicant’s height. People who weigh less in relation to their height tend to get a better classification for their weight.
  • Tobacco/alcohol/drug use: Both tobacco use and substance abuse put you at higher risk for health problems. Insurers may require that you have not used tobacco, abused substances, or had substance abuse treatment within a certain period to qualify for lower-risk health classes.
  • Blood pressure: Insurers look for blood pressure readings to fall within a certain range. For example, an insurer may require your blood pressure to be under 135/85 to get its best health classification (provided you meet the other requirements).
  • Cholesterol: Cholesterol readings and cholesterol/HDL ratios may also be monitored to see if they fall within normal ranges. Some companies may look for a ratio of less than 5.0 for their best rating.
  • Driving record: Your driving record can be considered. Driving while intoxicated (DWI), driving under the influence (DUI), a reckless driving conviction, or certain types of license suspensions can land you in a lower class.
  • Family medical history: Insurers may look into your family’s medical history to see if you are at a higher risk of an illness such as heart disease or cancer.
  • Personal medical history: Your medical history will be a factor, as cancer or other significant conditions might put you into a lower class.
  • Recreational activities: If you take part in high-risk activities like skydiving or scuba diving, your insurer may place you in a lower class.
  • Foreign travel: If you often travel to underdeveloped or unstable foreign countries, your insurer may see you as riskier to insure.

While not an exhaustive list, this gives you an idea of how life insurance companies assess risk for policyholders. In short, they are looking for anything that could be a threat to your health or life. In general, the less risk you present, the more you’ll save on your premiums.

Note

If you’re having trouble getting approved, many insurers offer guaranteed life insurance coverage. While coverage amounts may be limited and costs can be high for the coverage you get, these plans typically don’t require a medical exam and often won’t disqualify you based on a preexisting condition.

What Life Insurance Health Classification Means for You

If you are looking into getting health insurance, or already have it, the life insurance health classification assigned to you will determine your costs. In general, those who are young, healthy, and live a conservative lifestyle can often lock in lower rates on permanent life insurance and keep them for life. However, if you don’t have a risk-free profile, you can still improve your odds of getting competitive rates and coverage by shopping around.

Frequently Asked Questions (FAQs)

What are the classifications of life insurance?

Life insurers use health classification categories to determine if you’ll get a policy and what premium you’ll pay.

What is considered excellent health?

From a life insurance perspective, “excellent” health is health that can put you in an insurer’s best health classification tier. While details vary by company, typical requirements might include reasonable blood pressure and cholesterol levels; weight within a certain range based on your height; no history of alcohol or drug abuse in the past 10 years; no nicotine use in the past five years; and no personal or family history of certain conditions, including cancer and heart disease.

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Sources
The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Haven Life. “Can Credit Scores Affect My Life Insurance Premium?

  2. Term Insurance Brokers. “Life Insurance Risk Classifications: Risk Classes Explained.”

  3. Midland National. “Life Underwriting Requirements Guidelines.” Pages 9-11.

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